Administrative System Normalization to Take Four Weeks.

• What was said to be two weeks has now stretched longer. Kim Min-jae (Vice Minister of the Interior and Safety) stated, “We anticipate approximately two weeks for information resource preparation and another two weeks for system construction.”
• Of 647 administrative services, only 81 systems had been restored as of 10 PM on the 29th.
• While Gov24 and Bokjiro have been restored, the National Law Information Center and Policy Briefing are likely to face further delays.

Was the Immediate Crisis Truly Contained?

• Newspapers differ in their assessments. Kyunghyang Shinmun evaluated, “The immediate crisis was extinguished in four days,” while JoongAng Ilbo featured on its front page the plight of a post office shopping vendor: “We’re facing the loss of tens of thousands of Korean persimmons.”
• The Hankyoreh pointed out, “Regardless of political interests, the failures in neglecting ‘server redundancy’ must be thoroughly examined.”
• Seoul Shinmun criticized, “Three warnings were ignored.” A year ago, recommendations to replace batteries were dismissed, and reports urging firewalls were also neglected. No lessons were learned from the 2023 government network shutdown.
• Related Link.
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Disaster Was Foretold.

• The data center failed to meet essential requirements. Server spacing was 1.2 meters, and distance from batteries was 60 centimeters. The HVAC system was also malfunctioning.
• It’s been said, “It would have been no surprise if an accident like this occurred at any time.”

What Matters Now.

Kim Hyun-ji Moves to First Deputy Chief of Staff to Avoid Parliamentary Audit.

• Classified as a close aide to Lee Jae-myung (President). Kim Hyun-ji (Senior Secretary for General Affairs) has moved to the position of First Deputy Chief of Staff.
• Kim Nam-jun (First Deputy Chief of Staff) will take on the spokesperson role, while Yoon Gi-cheon (Second Deputy Chief of Staff) moves to Senior Secretary for General Affairs. Yoon’s former position will remain vacant for the time being.
• Park Seong-hoon (People Power Party Spokesperson) criticized, “It’s a sneaky move—like shifting the goalposts mid-game.” The implication is that the reshuffle aims to shield Kim Hyun-ji.
• A presidential office official stated, “Kim Hyun-ji will follow the National Assembly’s decision. If summoned for the audit, she will appear.”
• Related Link.

Controversy Over the “Choo Mi-ae Law” Prompts Retreat.

• ‘The Act on Witness and Expert Testimony in the National Assembly’ passed, but there was a farcical back-and-forth: the authority to file complaints was shifted from the National Assembly Speaker to the Judiciary Committee Chair, then reverted to the Speaker.
• The bill allows for post-facto complaints in cases of perjury in the National Assembly. The People Power Party protested, calling it “a stronger ‘Choo Mi-ae Law’ that steals U Won-shik’s (National Assembly Speaker) authority to give to Choo Mi-ae (Judiciary Committee Chair).” Even within the Democratic Party, there were concerns that it was “a law by Choo Mi-ae, for Choo Mi-ae, of Choo Mi-ae.”
• Ultimately, U Won-shik intervened to mediate, restoring the original provision.

“$350 Billion, Cash Is Impossible.”.

• Woo Sung-lak (National Security Director) emphasized, “We must play multiple cards, but not overplay them.”
• When asked if he was opposing the “self-reliance faction,” he said, “I don’t think I belong to any faction,” adding, “I am one of those who takes very strong positions.”
• According to the Bank of Korea, the maximum dollar funding South Korea can secure annually without reducing foreign exchange reserves is around $15 billion. Even with an additional $5 billion in foreign currency bonds, the Bank of Korea’s analysis concludes that $20 billion annually is the best-case scenario.

Busan Hosts Final Korea-Japan Summit.

• It is the last summit between South Korea and outgoing Japanese Prime Minister Ishiba Shigeru.
• The final chance to extract a forward-leaning stance from Japan on historical issues—such as regret or apology.
• Today marks the one-year anniversary of Ishiba’s selection as prime minister. He resigned, taking responsibility for soaring rice prices and failed tariff negotiations.
• Relations between Seoul and Tokyo are likely to worsen after Ishiba’s departure, as he is categorized as a moderate.
• Some speculate Ishiba might present a final gift to South Korea today. A departing prime minister taking responsibility and adopting a progressive stance could ease diplomatic burdens on his successor.

Deep Dive.

Yangpyeong Expressway: A “Fixed-Answer” Consultation.

• Documents show the government drafted a formal request for expert consultation after predetermining the conclusion.
• This occurred in July 2022, immediately after Yoon Suk-yeol’s (then president-elect) election victory. The expressway’s endpoint was altered to near land owned by Kim Keon-hee (Yoon’s wife) and her family.
• Won Hee-ryong (then Minister of Land, Infrastructure and Transport) explained, “The proposal came from a professional consulting firm,” but the special prosecutor’s office ruled that “economic viability assessments for alternative routes were manipulated by adjusting inflation rates to appear favorable.”
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107 Business Leaders to Attend National Audit.

• “This is not a national audit but a corporate audit,” complained Chosun Ilbo.
• The Science and ICT Committee leads with 27 attendees, including telecom CEOs Kim Young-seop (KT), Yoo Sang-jang (SK Telecom), and Hong Beom-sik (LG Uplus) appearing side by side.
• Foreign firms summoned include Zhang Rui (AliExpress Korea CEO), Woo Young-gyu (Kakao Vice President), Reginald Shawn Thompson (Netflix Services Korea CEO), Wilson White (Google Asia-Pacific Global Director of External Policy), and Heo Wook (Facebook Korea CEO).
• The Strategy and Finance Committee calls SK Chairman Choi Tae-won, Kim Byung-joo (MBK Partners CEO), Oh Kyung-seok (Upbit CEO), Lee Sun-jung (Olive Young CEO), and Kim Beom-seok (Coupang Chairman).
• A National Assembly official remarked, “It’s long been a staff aide’s skill to list trending figures as witnesses during audit season,” adding, “Even without real intent to summon, it’s common practice to initially include owners or executives—ostensibly for ‘guiding’ companies.”
• Related Link.

Another Take.

Will CPTPP Break the Trade Deadlock?

• Short for the Comprehensive and Progressive Trans-Pacific Partnership.
• A multilateral free trade agreement launched in 2018.
• Participating countries include Japan, Canada, Australia, Chile, Mexico, and Malaysia.
• It is the world’s fourth-largest FTA, accounting for 14% of global GDP.
• Huh Yoon (professor at Sogang University) emphasized, “The CPTPP is the most advanced form of multilateral trade agreement, despite the absence of the U.S. and China.”
• The Institute for Foreign Policy Analysis projected that South Korea’s GDP could grow by 0.38 percentage points if it joins the CPTPP.
• However, accession might require opening markets to Australian and Canadian agricultural products and Japanese seafood.
• Since membership requires unanimous approval, Japan’s consent is critical.
• Related Link.

Health Insurance Finances: Government Owes 22 Trillion Won.

• Under the National Health Insurance Act, the government must annually cover 20% of projected premium revenue. Yet from 2007 to last year, it never met this 20% threshold. The average support rate remained at 14.6%.
• The accumulated unpaid amount has reached 21.7285 trillion won.
• Yonhap News identified two key reasons.
• First, the government tends to interpret national treasury support as a temporary—not mandatory—measure.
• Second, government contributions are split between 14% from the general budget and 6% from the National Health Fund, financed by tobacco levies. A supplementary clause states that tobacco levy contributions “cannot exceed 65% of projected revenue.” This is used as a pretext to avoid fulfilling even the 6% obligation, effectively shortchanging the health insurance system.
• Related Link.

The Company with the Highest Proportion of Indirect Employment: Samsung C&T.

• Samsung C&T leads at 68%, followed by Hanwha Ocean (66%), Samsung Heavy Industries (63%), HD Hyundai Heavy Industries (61%), and POSCO (46%).
• Among firms with fewer than 10,000 permanent employees, Hyundai Engineering & Construction tops at 80%, followed by Hyundai Engineering (77%), GS Construction (75%), and Daewoo Construction (73%).
• Related Link.

Height Restrictions Near Seoul Airport to Be Lifted.

• Regulations on a 4 million-square-meter military protection zone will be lifted or relaxed—an area 1.4 times the size of Yeouido.
• Flight safety zones are divided into six categories, with higher numbers indicating weaker restrictions. Zone 6 allows buildings up to 154 meters tall. Areas like Bundang Yatap-dong and Songpa-gu Garak-dong will shift from Zone 2 to Zone 6. The 16-story Seokyeong Apartments in Tap Village could be expanded to 20 floors or more.
• According to Seongnam City, this area should have been reclassified 13 years ago when the runway was adjusted by 2.7 degrees to accommodate Lotte World Tower.
• Seo Jin-hyeong (professor at Kwangwoon University) noted, “Existing residential areas between Seoul Airport and Lotte World Tower in Songpa-gu all fall within the affected zone.”
• Related Link.

200,000 New Homes to Break Ground Along the Han River Belt.

• It’s a new initiative by Oh Se-hoon (Seoul Mayor) dubbed “Rapid Integration.”
• The plan aims to reduce redevelopment project timelines from 18.5 to 12 years. Environmental impact assessments will also be shortened.
• Of the 310,000 planned units, 200,000 will be concentrated in Han River Belt districts: Yangcheon-gu, Songpa-gu, Gangnam-gu, and Yongsan-gu.
• This directly clashes with Lee Jae-myung’s government policy of expanding public housing supply.
• Oh defended the plan: “Supplying sufficient housing in areas where citizens want to live is the fundamental solution to Seoul’s housing crisis and market stabilization.” He added, “The public’s role in housing supply is to eliminate unnecessary regulations, streamline overlapping ones, and support private-sector housing delivery.”
• Related Link.

“Doesn’t Fire Spread in Honam?”: Kim Jeong-jae’s Slip.

• Last Friday, during the National Assembly plenary session’s passage of a special law for wildfire damage relief, a voice was caught on video shouting, “Doesn’t fire spread in Honam?”
• As controversy erupted, Kim Jeong-jae (People Power Party) confessed: “I meant to urge support for the special law, as wildfires can occur indiscriminately across Honam and Yeongnam, not just specific regions.” He added, “My brief Gyeongsang dialect phrasing led to misunderstanding.”
• Han Jun-ho (Democratic Party lawmaker) demanded, “He should be referred to the ethics committee and expelled.”
• Related Link.

The Fix.

Toyota Woven City.

• Toyota is building an experimental city on a factory site in Shizuoka Prefecture.
• Akio Toyoda (Toyota Chairman) said, “We can’t multiply alone,” emphasizing, “We need companies to join us.”
• Park Su-ryeon (JoongAng Ilbo Industry Editor) stressed, “For Korea to create an AI experimental city that companies willingly participate in, the government must be not a crude vanguard but a meticulous sponsor or tireless supporter.”
• SK Group’s manufacturing AI hub in Ulsan, built with Amazon Web Services, could become a new model.
• Park Su-ryeon reiterated, “We need more Ulsans.”
• Related Link.

95% of Solar Cells Are Now Chinese.

• South Korea’s share has fallen from 50% five years ago to 4%. Chinese share has risen from 38% to 95%.
• Solar cells are the core component that converts sunlight into electricity. Modules are labor-intensive, where price competitiveness matters, but cells are technology-intensive, where efficiency is key. Now, even cells—following modules—have been overtaken by Chinese products.
• Concerns emerge: “The roots of the solar industry are shaking.”
• Related Link.

ICYMI.

Rock-Paper-Scissors Odds: 35%+35%+30%.

• Beginners are more likely to play scissors, so playing rock is advantageous.
• Veterans are more likely to play rock, so playing scissors is advantageous.
• If tied, play what beats your previous move. If you tied with scissors, playing paper next has higher odds.

First Day of Visa-Free Entry for Chinese Tourists.

• Groups of three or more can now tour South Korea visa-free for up to 15 days.
• Yesterday, 1,700 Chinese group tourists arrived via a cruise from Tianjin.
• Projections estimate up to 1 million visitors by June 30 next year.
• Related Link.

100% Tariff on All Films Made Outside the U.S.

• Trump could “taco” (always cowering and retreating) again, but he said, “To solve this old, never-ending problem, I will impose a 100% tariff on all films made outside the U.S.”
• Tariffs will also apply to imported furniture. On Truth Social, he wrote, “We will make North Carolina great again by reclaiming the furniture industry from China and other countries.”
• Plans include a 50% tariff on kitchen cabinets, bathroom vanities, and related products, and a 30% tariff on upholstered furniture.

Treatonomics Generation.

• ‘Treatonomics’ combines the English words for ‘treat’ and ‘economics.’
• Woo Chang-seop (NH Nonghyup Bank Data Business Center Director) said, “Amid economic downturns, instead of cutting overall spending, the so-called ‘treatonomics’ phenomenon—choosing ‘small luxuries’ for oneself—is becoming pronounced among those in their 20s and 30s.”
• Analysis of consumption patterns among the 2030 generation shows that while overall spending has decreased, investments in hobbies like concerts, musicals, and ski resorts, as well as self-improvement, have increased. Consumption of protein drinks and zero-sugar beverages has also risen. Payments at franchise bakeries have declined, while spending at local bakeries has increased.
• Related Link.

Worth Reading.

Risks of Misinformation and Punitive Damages.

• Watchdog journalism carries the risk of misinformation. Intent is also difficult to verify.
• Lee Jong-kyu (Hankyoreh Journalism Accountability Director) pointed out, “The media’s argument—that if punitive damages had been in place during the Yoon Suk-yeol administration, many investigative reports would never have been published—has some validity.”
• Lee emphasized, “We must not forget that political discussions about punitive damages are driven by citizens’ accumulated distrust of the media.”
• The Democratic Party plans to expand the scope of damages beyond news reports to include YouTube and social media. They are currently revising the Information and Communications Network Act.
• Related Link.
• Related Link.

The Real Cruelty Lies Not in Self-Declaration but in Selective Welfare and Stigmatization.

• “They don’t apply, so they don’t receive—and that’s why people die without support.” These were the words of Lee Jae-myung.
• The fact that the Songpa three generations of women 11 years ago were rejected despite applying must not be overlooked. Many driven to extremes have experienced rejection after applying for public assistance. This is why even in dire straits, people hesitate to apply.
• Nam Chan-seop (Dong-A University Professor) pointed out, “Automatic payment systems can be easily introduced in universal welfare, but are nearly impossible in means-tested assistance for crisis households.”
• The core issue is not self-declaration. Nam Chan-seop argues, “The greater problem is the stigma generated when applicants must personally prove their poverty.”
• “The president called this ‘cruel self-declaration,’ but the real issue lies elsewhere: selective welfare systems that inherently stigmatize, bureaucratic demands that overly burden applicants with proving poverty, and a welfare-suppressing mindset that perpetuates such bureaucracy.”
• “Gaps in coverage arise not from a lack of ‘outreach welfare’ but from systemic flaws. Strict eligibility criteria may exclude people from the start, excessive demands to prove vulnerability may cause mid-process abandonment, and humiliating treatment during applications may lead to withdrawal. These are not issues to be solved by ‘outreach welfare’ or ‘helicopter-style administration’ but by institutional reform.”
• Related Link.