The 22nd election for members of the National Assembly commenced with a full-fledged 14-day election period starting from March 28, 2024. While the primary aim of this election is to elect the members of the National Assembly, the evaluation of election pledges remains crucial.
The People Power Party and the Democratic Party announced the ten major pledges on March 14, 2024.
It appears that both parties seem poised to tailor their pledges to respond to the immediate issues, such as proposing measures to combat population decline resulting from low birth rates, aiming to garner public consensus.
We briefly summarized the contents of the ten major pledges announced by the parties, examining differences in pledges as across different sectors such as labor, energy, and their implications.
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I. COMMON COMMITMENT
A. Support for Small and Medium Enterprises ∙ Start-Ups ∙ Small Business Owners
1. Support for the export of small and medium-sized enterprise
2. Reduction of the burden of energy costs of small and medium-sized enterprises
3. Establish incentives for start-ups to enter the provinces
4. Reduction of the burden on small business owners
B. Fostering Future Industries
1. Full support for the semiconductor industry
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Support for the expansion of infrastructure for the semiconductor industry
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Support for next-generation technology R&D, including Sub-General Manager initiatives
2. Focused investment in future strategic industries such as Bio and AI
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Promoting the establishment of a regional cluster, such as an advanced industrial complex
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Policy support for nurturing industry-specific talent
C. Climate Crisis Response
1. Expansion of the Climate Response Fund
2. Increase in the allocation of emission trading allowances
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People Power Party: Raising reduction targets for each industry during the 4th plan period (2026-2030)
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Democratic Party: Directing proceeds from increased paid allocations to the Climate Response Fund.
3. Drive the transition to carbon neutral (low carbon) industries
4. Activation of climate finance (green finance)
D. SOC
1. Underground railways
2. Construction of additional GTX lines
II. DIFFERENTIATED COMMITMENTS BY MAJOR SECTORS
A. Labor Sector
1. People Power Party
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Improvement of the system to extend paid holidays to workers in workplaces with fewer than five employees.
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Extension of the implementation period of financial support for the Small and Medium Enterprise Retirement Pension Fund and reduction of the requirements for the small and medium enterprise retirement pension
2. Democratic Party
B. Renewable Energy Sector
1. People Power Party: Advocating the co-existence of nuclear power plants and renewable energy
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Expansion of carbon-free energy through active promotion of innovative next-generation nuclear power plants (SMR)
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Establishment of the "Special Act on Support for the Abolition of Coal-fired Power Plants" and conversion of thermal power plant areas such as Chungnam and Incheon into clean hydrogen production sites
2. Democratic Party: Addressing energy issues through renewable energy expansion
C. Commitments in Other Sectors
1. People Power Party
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Abolition of Financial Investment Income Tax
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Review of postponing the imposition of the tax on virtual asset investment income until the legislation of virtual assets is complete
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Major reorganization of the regulatory sandbox system for industrial development
2. Democratic Party
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Prosecution reform (Investigation ∙ Separation of prosecution power, substantiation of the National Police Commission, abolition of the police department, etc.)
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Introduction of specialized banks for small business owners
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Issuance of spot ETFs with underlying assets such as Bitcoin ∙ Listing ∙ Transaction permitted
III. IMPLICATIONS
Once the 22nd National Assembly commences its activities, the pledges outlined by the parties are expected to materialize into policies through legislation or budget allocations. Companies should closely monitor the progress.
1) The pledges commonly proposed by both parties, are likely to be prioritized for discussion and policy implementation by due to fewer differences between the parties.
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Push for underground railway construction and expansion of GTX construction
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Expansion of the Climate Response Fund and increase in allocation of the Emission Trading System
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Expansion of the flexible delivery price system to include energy cost consideration for small and medium-sized enterprises
2) Although common pledges, main issues of interest to each party, such as those presented in subparagraph 1, are likely to be pursued as major legislative tasks.
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People Power Party: Abolition of financial investment income tax, mandatory one-month paid leave for fathers and postponement of taxation on virtual asset investment income
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Democratic Party: Stipulation in the Labor Standards Act prohibiting the comprehensive wage system, prosecution reform, establishment of a housing complex platform with 1 million basic housing units, etc.
3) In addition, both parties emphasize their major commitments to address national and social issues such as low birth rates, climate crisis, and energy crisis. These issues are expected to be actively resolved through future legislative and policy implementations. Stakeholders should stay informed and engaged as these pledges share future policies and initiatives.
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As government policies are announced in each field, we will distribute newsletters highlighting important matters that require active attention, utilization and close response from companies.
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