PPP calls on president to apologize, demands accountability over Kospi plunge

The People Power Party called on the Lee Jae Myung administration Sunday to stop what it called "Kospi index politics," after the benchmark index plunged more than 6 percent on a "Black Friday" to barely hold the 5,000-point line.

People Power Party Chief Spokesperson Choi Bo-yun said in a commentary Sunday that the Kospi had crashed more than 8 percent within three minutes of opening on Friday, triggering a circuit breaker, before recovering to close at 5,059.69 after briefly breaking below 5,000 for the first time in nine months. "'Kospi 5,000' was a target the administration set — but the 3,270 trillion won ($2.44 trillion) bill was handed to the people," Choi said.

On the causes of the "Black Friday" selloff, Choi acknowledged that "US-driven AI regulation shock was the trigger," but said "it was this administration that turned a flu into pneumonia."

Choi said the president had "set a share index target of 5,000 points, calling it the normalization of the abnormal, and encouraged investment," while ruling-party figures had "chorused targets of 7,000, 8,000 and 10,000." Choi also said the then-Cheong Wa Dae policy chief had boasted on a YouTube broadcast that South Korea would rank among the world's top three by market cap and even offered to bet on it, while the Democratic Party had told voters to "mark No. 1 on the ballot if your brokerage account makes you smile."

"The national pension fund even raised its domestic equity target allocation from 14.9 percent to 20.8 percent in May. The index became an election slogan, and investment became speculation," Choi said, adding that "a market weakened to the bone could not absorb the shock and was hit by another circuit breaker."

Choi went on to quote Ruchir Sharma, chairman of Rockefeller International, who had said that South Korean political leaders, including the sitting president, set Kospi targets — something no leader in any other country does. "Only this administration practiced 'index politics' that no one else in the world does," Choi said.

Choi said the government's response to the plunge was a stopgap measure — a three-month exemption from margin maintenance requirements to delay forced selling. "But if the decline does not stop, losses do not disappear — they are pushed back and can grow larger. This did not prevent losses; it only deferred them," Choi said.

"When it goes up, 'my credit.' When it falls, 'someone else's fault.' That is this administration's index politics. Not a single person is taking responsibility," Choi said, calling on the president to apologize to the public and hold accountable the economic team that designed the index politics strategy.