[Director is in a slump to make a strong dollar]

[Director is in a slump to make a strong dollar]

The won-dollar exchange rate has exceeded 1450 won, and there are predictions that it will exceed 1,500 won early next year. It should also be taken into account that the dollar index itself is rising, and the gap between the U.S. base rate and the Korean base rate is still close to 2%p.

However, a major cause of the strong dollar in terms of long-term trends is the continued slump of the domestic stock market and investment in foreign financial assets. Over the past decade, net foreign financial assets have increased by $977.8 billion. Koreans, who used to be dollar-denominated bonds or dollar-denominated securities, are steadily buying foreign financial assets.

In the past year alone, the balance of overseas securities investment assets has increased by $64.6 billion. $26.3 billion in new overseas securities has been purchased, and the valuation of existing securities is $38.3 billion. Although not shown in the table, dividend income is approaching $2 billion in the quarter. I've invested 25 years in domestic finance alone, but I started buying foreign stocks directly since 2020, and I've been buying foreign bonds directly since last year. There are still more domestic financial assets, but when I look at the director-general's returns over the past four years, I can only sigh.

The strong dollar may help exporters, but due to the burden of energy and food imports, prices are rising, and by 2022, companies that have issued dollar bonds at low interest rates are coming back as a huge burden. Let's say a company that raised 600 billion won five years ago by issuing 500 million dollar bonds at an exchange rate of 1,100 won at a 1.75% interest rate. On a condition of a temporary repayment to maturity, the company needs 800 billion won. It would be fortunate to roll over, but otherwise it would be a considerable burden, with a similar condition of $8.8 billion due next year. If the strong dollar persists through the second half of next year, even large companies that are facing limitations due to competition with China could face severe financial difficulties.

The Korean economy has made tens of billions of dollars a year in its current account so far, but the dollar is still expensive. The reason is that, in the end, foreign financial markets are attractive, investors who have invested in Korea are also withdrawing money, and even ants are making foreign direct investments. We cannot blame or stop this because the profitability of overseas investment is good. Eventually, the chronic Korea discount in the domestic stock market must be solved. If not in the United States, where PER is close to 30, it should be at least 20 years, but the reality is that it is around 12, so there is a long way to go.

If the Korean stock market fails to attract investment in the U.S. dollar by making it attractive and preventing domestic investors from leaving the country, the money and talent will gradually flow out. We need to stabilize politics and introduce a shareholder-focused policy. It is for the entire national economy and citizens.