3 Mega Projects to Receive 2,000 Trillion Won Investment.

• Today, the “Korea Leap Forward 3 Mega Projects” are unveiled. President Lee Jae-myung, Lee Jae-yong (Samsung Electronics Chairman), Chey Tae-won (SK Chairman), and others attended the announcement at the Blue House’s State Guest House.
• Samsung Electronics and SK Hynix initially considered building packaging plants in the Honam region but have now decided to construct entire fabs. Specific scenarios emerged: 1,500 trillion won for semiconductors, 500 trillion won for AI data centers.
• Investment plans for the Chungcheong and Yeongnam regions are also revealed. Samsung Electronics will expand its Onyang campus and Samsung Display’s Asan-Cheonan campus, while SK Hynix will increase capacity at its Cheongju plant.
• The Yongin Semiconductor Cluster timeline is also being accelerated.
• Kim Yong-beom (Blue House Policy Director), appearing on “Kim Eo-jun’s News Factory,” warned, “Given the scale of investment, debates will intensify—starting with skepticism over whether this is even feasible.”
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“They Asked for an Addition, but Got a Demolition” – Yoo Si-min’s Bombshell Comments Rock the Democratic Party.

• “Supporters wanted an addition. A three-story house, adding one more floor. Expanding toward moderate conservatism was something everyone agreed on. But it seems the president wanted to demolish and rebuild.”
• Yoo Si-min (author) unleashed sharp criticism, stating, “The president’s confidence has become excessive.” He claimed, “Defamation of former presidents has continued for over six months, yet no one steps forward,” likening it to “an autoimmune disease where immune cells attack normal cells instead of external viruses.”
• Kim Min-seok (Prime Minister) responded, “This is an overinflated confidence that suggests ‘I created the president.’” He added, “There is a need to temper the attitude of criticizing the president.”
• Jeong Cheong-rae (Democratic Party Leader) remarked, “It seems like a time when we should all hold our tongues.”
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“An Ugly Family Feud.”.

• Kyunghyang Shinmun’s editorial noted, “The ruling party must heed the criticism that this unsightly internal conflict has become the biggest obstacle for the Lee Jae-myung government.”
• “Yoo Si-min’s autocratic factionalism only diminishes Lee Jae-myung to a leader of a specific clique and fuels emotional infighting within the camp,” the outlet observed.
• Kukmin Ilbo’s editorial warned, “Even in power struggles, there are lines that must not be crossed,” criticizing, “It is only proper to fight under the pretense of addressing public livelihoods, yet they are openly obsessed with power struggles.” “It treats the public with contempt,” it added.
• Hankook Ilbo labeled it “subtraction politics,” with its editorial criticizing, “There is no choice but to see this as a calculated effort to cloud public judgment with plausible logic, destabilize the presidency, and maintain political influence.”
• Hankyoreh’s editorial pointed out, “The highly volatile issue of abolishing supplementary investigative authority must be left to parliamentary debate to prevent it from escalating into counterproductive conflict.”
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“No Special Treatment for Honam Semiconductor Plants.”.

• Lee Jae-myung (President) flooded X with posts over the weekend.
• Samsung Electronics and SK Hynix’s investments were corporate decisions, he explained, with the government only expressing intent to support. “This is not abuse of authority, coercion, or orders—it’s administrative guidance or facilitation,” he emphasized.
• This rebutted claims by Oh Se-hoon (Seoul Mayor) and others that it was a “privatization of state affairs” where “big business arms were twisted” and “corporate freedom was violated.”
• Sharing former Saenuri Party lawmaker Yoo Seung-min’s argument that “semiconductors require more than just water,” Lee countered, “The southwest coast is richest in renewable energy. Stable, low-cost land in underdeveloped Honam is ideal, with no earthquakes.”
• Kim Yong-bum (Blue House Policy Director) also posted on Facebook, arguing, “A large-scale semiconductor fab cluster outside the capital region could be a powerful national strategy.”
• Koo Yoon-chul (Minister of Economy and Finance) added, “This is a time of global competition for survival in advanced industries. To secure a decisive edge, we must mobilize all national resources: human capital, infrastructure, and land.”
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People Power Party Stoking Honam Favoritism Claims.

• Jang Dong-hyeok (People Power Party Leader) claimed, “The president is pressuring Honam visits,” to which Na Kyung-won (People Power Party lawmaker) chimed in, “Political directives from a socialist state.”
• Jang also asserted, “It’s like saying, ‘Give us semiconductors, and drop Jeong Cheong-rae,’” adding, “At this point, Jeong Cheong-rae is almost pitiable.”
• The Hankyoreh editorial criticized, “This has gone way beyond the line,” noting, “By this logic, regional conflict would be inevitable wherever non-capital areas are chosen, ultimately meaning sites must stay in the capital region.”
• The Korea Daily editorial pointed out, “If it must be Honam, sufficient comparative reviews with other regions must be disclosed.” “Only then can suspicions of politically motivated decisions to win pro-Myung faction votes be dispelled,” it argued.
• Lee Jae-myung (President)’s X post—“To a Buddha’s eyes, a Buddha appears; to a pig’s eyes, a pig”—was likely aimed at Jang Dong-hyeok. Park Ji-won (Democratic Party lawmaker) retorted on X, “Stop oinking, pigs. Businesses won’t come if they lose money.”
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What Matters Now.

World Cup Group-Stage Exit, Hong Myung-bo Resigns.

• Park Ji-sung (JTBC Commentator) said, “We forgot what we learned over the past decade and repeated the same mistakes,” calling it “pitiful.”
• The squad returns home on the 30th. No homecoming event will be held.
• Chosun Ilbo’s front-page headline assessed, “Even the heavens abandoned us.” The evaluation: no skill, no luck, and even the cruel hope of mathematical scenarios vanished. Kyunghyang Shinmun criticized, “Tactically clueless Hong Myung-bo has buried a golden generation in futility.”
• Dong-A Ilbo’s front-page headline blared, “Incompetent Football: Red Card.”
• The Hankook Ilbo’s front-page headline also assessed, “A Catastrophe Bred by Incompetence.” Criticism emerged: “They called it a ‘historic easy group,’ but we were the real ‘honey.’”
• Lee Jae-myung (President) also criticized on X, “The outcome is obvious when you appoint an incompetent person as commander.”
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Japan vs. Brazil Clash.

• Big matches abound. The Netherlands faces Morocco. France and Germany are likely to meet in the Round of 16.
• Cabo Verde’s advancement to the Round of 32 is also considered an upset.
• Uruguay, failing to reach the Round of 32, canceled its charter flight and instructed players to return home individually.

Five Incidents That Drove a Wedge Between Lee Jae-myung and Jeong Cheong-rae.

• “The relationship is beyond repair,” is the dominant assessment. Some say, “Even if they reunite, they’d only be a show-window couple.”
• There were several key incidents.
• First, during the 2021 Democratic Party presidential primary, Jeong Cheong-rae supported Lee Nak-yon (former Prime Minister) over Lee Jae-myung (then Gyeonggi Governor). A close associate met by JoongAng Ilbo said, “There could have been lingering doubts about Jeong Cheong-rae being someone who could turn his back at any moment.”
• Second, during the August 2022 party convention, Lee Jae-myung quietly supported Park Chan-dae (former Democratic Party floor leader) without publicly emphasizing it.
• Third, Jeong Cheong-rae’s claim that he coordinated with the Blue House when proposing a merger with the Cho Kuk Innovation Party was untrue. Lee Jae-myung reportedly took offense, saying, “It was framed as if it were my intention.” Jeong may have aimed to counter Kim Min-seok.
• Fourth, they clashed over the prosecution’s supplementary investigative authority. Even after Lee Jae-myung set a guideline saying, “It might be exceptionally necessary,” Jeong Cheong-rae refused to budge from his stance: “The final period for prosecutorial reform is the complete abolition of supplementary investigative power.”
• Fifth, after Lee Jae-myung said the local election results “cannot be called a success,” Jeong Cheong-rae retorted, “The people are eternal, and administrations are short-lived.”
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“Core Defection Is a Myth.”.

• Son Won-je (Hankyoreh columnist) pointed out, “The decline in Gwangju-Jeolla was the smallest, and those in their 50s dropped twice the average,” adding, “It’s hard to see this as solely a defection of the core.”
• In a Gallup Korea survey, Democratic Party supporters’ preference for party leadership was 45% for Kim Min-seok and 24% for Jeong Cheong-rae—a significant gap. It’s plausible to interpret this as the core not defecting but rallying behind the pro-Lee faction.
• Kim Wan (Hankyoreh reporter) analyzed, “One person, one vote is a popularity contest, and in a popularity contest, Lee Jae-myung is first. Among the three leadership contenders, two are aligned with the president and one opposes him, so party members naturally choose Lee Jae-myung.” The analysis suggests that those who left were soft supporters in their 20s–30s and over 60s.
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Deep Dive.

Drone Attack on Cargo Ship Passing Through Strait of Hormuz.

• It was an attack by Iran’s Revolutionary Guard Corps. The ship was attacked while attempting to pass along the Omani coast. The Revolutionary Guard Corps claims that shipping schedules must be negotiated and that alternative routes should not be used.
• No casualties were reported, but the situation contradicts Trump’s claim that “the strait is fully open.”
• Out of 26 South Korean-flagged vessels, only five remain.
• There are projections that Iran’s government could collect up to $40 billion annually in transit fees.
• Armed clashes continue. The U.S. attacked Iranian military facilities, and Iran struck U.S. military bases in Kuwait and Bahrain.
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Kim Keon-hee Sentenced to 7 Years for Mediation Bribery.

• This is the first-instance ruling. The court stated, “The crime is more severe as she ignored the social responsibilities of her position as the president’s wife and used it as a means to pursue private gain, and we cannot avoid holding her accountable accordingly.”
• The court ordered the confiscation of Lee U-fan’s (artist) painting, gold turtles, a necklace, etc., and an additional 64.8 million won in restitution, ruling, “It is recognized that these were received with awareness of the quid pro quo.”
• Lee Bong-gwan (Chairman of Seohee Construction), who provided 100 million won worth of Van Cleef & Arpels necklaces and brooches, received a 1-year prison sentence, suspended for 2 years.
• Seo Sung-bin (CEO of Drone Dome), who gave a 40 million won Vacheron Constantin watch, received a 10-month prison sentence, suspended for 2 years.
• Lee Bae-yong (former Head of the National Education Committee), who provided a 2 million won gold turtle, received a 10-month prison sentence, suspended for 2 years.
• Choi Jae-young (pastor), who gave a 5.4 million won Dior bag, was fined 8 million won. All were convicted of violating the Improper Solicitation Act.
• Kim Sang-min (former prosecutor), who provided the Lee U-fan painting, was previously sentenced to 3 years in prison, suspended for 3 years, in a separate trial. The painting’s authenticity remains disputed.
• Kim Keon-hee plans to appeal, maintaining, “There was no solicitation, so the claim of a quid pro quo is baseless.”
• This is the second ruling among the three trials Kim Keon-hee is facing. The Deutsche Motors stock manipulation case resulted in a 4-year sentence upon appeal. The trial for violating the Political Party Act is scheduled for its first hearing in August.
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Another Take.

“Top-Tier AI Only for White House-Approved Clients.”.

• U.S. Department of Commerce stepped back, telling Anthropic, “You may grant usage rights to government-approved trusted partners.” Faul 5 remains closed to the public, while Mythos 5 will be released only to select customers.
• OpenAI also announced that while releasing GPT-5.6, it will prioritize certain clients per government requests.
• There are predictions that while U.S. companies hesitate over regulatory issues, Chinese competitors will close the gap faster.
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Why Apple Is Buying DRAM from China.

• Apple is in talks to purchase DRAM from CXMT (Changxin Memory Technologies), which is on the U.S. government’s blacklist. Approval from the Commerce Department is required.
• Apple’s market value dropped by $263 billion after it raised MacBook and iPad prices last week.
• John Mulaney (Republican Chairman of the House China Committee) said, “Apple’s collaboration with a Chinese military-linked company is a grave misstep.” Trump previously ignored staff objections last year to allow Nvidia to sell H200 chips to China.
• It may be a backlash from chip inflation, or observations suggest that Chinese advancements are faster than anticipated.
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Only Korean Chips Are Cheap.

• Financial Times assessed that while U.S. and Taiwanese markets are both expensive, the UK and Europe are cheap, with South Korea as an intriguing exception.
• Samsung Electronics and SK Hynix have such large expected profits for next year that their forward PER remains low. While governance concerns have largely eased, they still weigh on valuations.
• In the graph below, the horizontal axis is the forward price-to-earnings ratio (reflecting next year’s performance), and the vertical axis is the cyclically adjusted price-to-earnings ratio (Cape, reflecting the past 10 years’ performance). South Korea is expensive relative to past performance but very cheap relative to future performance.
• It should not be overlooked that whether they are overvalued ultimately depends on AI investment returns. A significant correction is also possible.
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5.35 Million Local Government Contracts Scrutinized.

• Over the past four years, 2,179 sole-source contracts worth at least 50 billion won were linked to companies associated with local council members, reported Kyunghyang Shinmun.
• A construction company where the brother of Do Ki-wook (Gyeongbuk Provincial Assembly member) and his wife serve as executives secured a 5.9 billion won project in Yecheon County—a prime example.
• Some members continue side businesses after election, while others transfer ownership to in-laws like daughters-in-law to “park” their interests.
• Self-dealing abounds: council members allocate budgets, design projects, and then secure them via sole-source contracts.
• Researchers filtered company names tied to council members, their spouses, and immediate family from public asset records, then used Claude code to extract related contracts.
• Seo Hwi-won (Korea Economic Justice League Planning and PR Team Head) noted, “When the ruling party of the local executive and the majority party in the council align, oversight collapses.”

Government Lowers Oil Price Cap by 150 Won.

• Gasoline fell to 1987.6 won, diesel to 1978.3 won.
• Prices dropped by 182 won and 184 won respectively from 2005.8 won and 1996.7 won on the 26th.
• The government reduced the maximum gasoline price by 150 won starting October 27. Supply prices are 1784 won and 1773 won respectively.

The Fix.

Is 13 the Right Age for Juvenile Justice?

• Experts have long argued for maintaining the 14-year threshold while improving the system, but the government’s compromise diverges. It is considering lowering the age to 13 only for serious crimes.
• The move is widely seen as reflecting public opinion. Lee Jae-myung (President) once remarked, “The overwhelming majority of citizens seem to think it should be lowered by at least one year.”
• A Gallup Korea poll found 81% of respondents supported lowering the juvenile justice age threshold.
• Han Young-sun (Kyonggi University professor) noted, “Denmark lowered its criminal minority age but restored it after recidivism rose, and U.S. states that lowered the age saw increased crime rates.”
• Park Sun-young (Hansai University professor) said, “During public deliberations, recommendations advised against lowering the age—emphasizing it wouldn’t deter crime—but the government’s rejection is puzzling.”
• The JoongAng Ilbo cautiously supports the age reduction. In an editorial, it stressed, “Given that juvenile offenders have far more years ahead than adult criminals, we must not abandon their potential for rehabilitation and reintegration.”
• The Dong-A Ilbo warned in an editorial, “Without clear criteria for what constitutes a serious crime, similar offenses could face uneven punishment, sparking fairness debates.”
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Raising Elderly Age to 70? Fears of Welfare Gaps.

• In a world where 60-somethings struggle to even claim senior status, the Elderly Welfare Act has for 45 years since 1981 fixed 65 as the age for preferential treatment. Life expectancy was 67.9 in 1981 but has risen to 83.7 as of 2024.
• Raising the threshold for social welfare systems like basic pensions or long-term care insurance could severely impact low-income seniors and patients, critics warn.
• Lee Sam-sik (Hanyang University professor) noted, “The elderly criteria should be raised, but healthcare and long-term care services must be guaranteed based on health status and care needs.”
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How to View the Colosseum Yoo Si-min Has Unleashed.

• Kim Eo-jun’s diagnosis that “the core is shaking” is already contentious. If the pro-Roh, pro-Moon, and pro-Lee factions are the core, there’s no reason for the core to shake. At most, if factions B and C (pro-Moon and pro-Lee) are shaking, but there’s no evidence yet that faction A (pro-Roh) is wavering.
• Gallup Korea’s data hasn’t reached a dead cross yet. More observation is needed. The analysis that the president’s approval rating and Democratic Party support are decoupling also lacks sufficient basis.
• Yoo Si-min’s claim that this is a “reconstruction, not an expansion” is an overstatement. Has Lee Jae-myung betrayed the Democratic Party’s core values? There are disagreements over prosecutorial reform, but Yoo doesn’t address other issues.
• To diagnose an “autoimmune disease,” one must first define which side is the normal cell. Yoo divides pro-Moon and pro-Lee factions, claiming the former are the normal cells.
• The argument that the so-called “New Lee Jae-myung” group is pushing out the core is misleading; rather, it’s widely viewed that this group serves as a foothold for Lee’s government’s centrist policies. In reality, the Democratic Party’s core alone struggles to surpass 40%, let alone 50%.
• Claims that prosecutorial reform has been delayed must be contextualized. Kim Min-seok argued that Rep. Jeong Cheong-rae initially proposed postponing it until after local elections, but Jeong refuted this, stating, “I have no such memory; we were waiting for the government’s proposal.”
• Ultimately, the conflict’s essence is a power struggle. Yoo Si-min’s explosive remarks—after over 20 years as a Democratic Party ideologue—have brought the conflict between Jeong Cheong-rae’s pro-Moon faction and Kim Min-seok’s pro-Lee faction to the surface.
• Critiques like “the public sphere is contaminated by money” or “paid commentators” lack evidence. Rep. Choi Min-hee’s disclosed government ad spending on YouTube shows no concentration of support for specific YouTubers. Even if the claim is about traffic-driven criticism of Yoo, the accusation that “demolition experts were deployed” is an overreach.
• As writer Lee Dong-hyung noted, it’s true that Kim Eo-jun and Yoo Si-min’s influence isn’t what it used to be. Unlike their past ability to generate overwhelming enthusiasm, some Democratic Party supporters are turning away. The reconstruction debate Yoo sparked could accelerate this division.
• The August 17 Democratic Party convention is likely to transcend the Jeong Cheong-rae vs. Kim Min-seok rivalry, becoming a clash between pro-Moon and pro-Lee factions—and simultaneously a leadership battle between the old Democratic Party (centered on Kim Eo-jun and Yoo Si-min) and the newly consolidated Lee Jae-myung fandom.
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ICYMI.

Try Kimchi on Your Sandwich.

• Eat yogurt for breakfast, pair kimchi with eggs or sandwiches, make salad with apple cider vinegar—advice suggests eating more fermented foods.
• This is the advice of Sean Spencer (Stanford University professor) interviewed by the New York Times.
• Microorganisms in fermented foods help alleviate inflammation and regulate blood sugar. They aid digestion and nutrient absorption, and even produce folate, riboflavin, and vitamin B12.
• The hypothesis is that exposure to beneficial microbes builds immunity against harmful ones, though it’s not yet scientifically proven.
• Countries that consume more fermented vegetables also have higher rates of stomach and esophageal cancer, but causation remains unconfirmed.
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The Auto Market Has Shifted.

• Rental cars reached 1.14 million units, with long-term personal rentals accounting for 48%.
• Vehicle utilization rates remain below 10%.
• JoongAng Ilbo analyzed, “For 100 years, the auto industry’s success formula was ‘economies of scale’—producing more to sell cheaper. That equation is now unraveling.”
• First, car subscription services have proliferated,
• Second, software-defined vehicle (SDV) revenue is growing. Tesla offers its Full Self-Driving (FSD) option as a $99/month subscription.
• Kim Pil-soo (Daelim University professor) said, “Unlike older generations, Gen 2030 tends to view cars not as essential assets to own, but as mobility tools to use when needed.”
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The Federation’s Cartel.

• Hong Myung-bo (manager) was ousted once after the 2014 World Cup. The 2024 reappointment process drew criticism that a Korea University cartel—including Chung Mong-gyu (Korea Football Association president) and Lee Im-saeng (KFA technical director)—was at play.
• The football association operates under an indirect election system, with electors comprising regional association heads, national league presidents, coaches, referees, and player representatives. Chung Mong-gyu, in office since 2013, has secured three consecutive terms, now in his 13th year.
• Hong’s return repeated the same misjudgments mocked as “crony football” and “loyalty football,” with no improvement in tactical poverty.
• Calls for near-total dismantling and reform are growing.
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Worth Reading.

How to Boost Approval Ratings.

• “Emphasize inclusion, unity, and a centrist path,” advises Sung Han-yong (senior Hankyeoreh journalist). Unlike Yu Si-min (author)’s criticism, the issue lies in personnel decisions, not the policy direction.
• Sung Han-yong proposed three points:
• First, continue with pragmatic centrism.
• Second, remove the prosecution dismissal clause from the special prosecutor bill.
• Third, restore political dialogue and engage with the People Power Party.
• Kang Byung-han (Kyunghyang Shinmun political editor)’s advice aligns closely: “If Lee Jae-myung declares the prosecution dismissal clause should be dropped, everything will fall into place afterward.”
• “Public sentiment supports restrained power. The local elections’ warning lies exactly there.”
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Ending the Five-Year Curse.

• Structural change, not short-term results, is needed.
• “What kind of president do you want to be remembered as? One who managed administration well? One who was pragmatic? The president we need is one who carries a historical mission and begins bold structural reforms to break the vicious cycle of growth exacerbating socioeconomic crises.”
• Yoon Hong-sik (Inha University professor) warned, “Presidents who postponed structural reforms and focused on short-term results met clear ends.” The condition for a successful presidency, he said, is “creating a regime that sustains reform.”
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There Must Be a Justification.

• Yoon Bi (Sungkyunkwan University professor) assessed, “I can’t grasp why either Kim Min-seok or Jung Cheong-rao could say, ‘It has to be me or it won’t work.’” The argument is that “any political struggle must start from the goal of alleviating the despair people face in their daily lives and creating hope.”
• “South Korea today has too much suffering and despair to be consumed by power struggles. When they fail to hear the sighs of the people, people will abandon them regardless of who holds power.”
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