The Democratic Party of Korea said it will accelerate efforts to expand regional investment and protect low-income borrowers, citing upward revisions to South Korea's growth outlook. The plan combines promoting investment in artificial intelligence and other advanced industries outside the capital region to raise growth potential with strengthening investigative powers over illegal private lending to shield vulnerable groups from financial harm.
Kwon Chil-seung, a Democratic Party lawmaker, said at a party meeting on parliamentary audit strategy at the National Assembly on Oct. 15 that the International Monetary Fund now projects South Korea's economic growth at 3.3% this year, raising its forecast by 0.7 percentage points from 2.6% in July in just three months. "It is a meaningful achievement in that our economy's growth capacity is being confirmed despite the war in the Middle East and global uncertainty," he said.
Kwon stressed that the country should not grow complacent over the rebound and must strengthen the fundamentals of its economy. "The KDI is warning that our potential growth rate could keep declining due to population decline and slowing productivity," he said. "To carry the current recovery into sustainable growth, we must step up efforts to raise the potential growth rate."
He identified fostering advanced industries and expanding investment outside the capital region as the key tasks. Kwon said the country needs to strengthen industrial competitiveness in the AI era and build new growth hubs across regions, and that companies' autonomous investment decisions should be supported. Citing SK Group Chairman Chey Tae-won's recent visit to a planned semiconductor cluster site in the Honam region, he said, "The government and the National Assembly must join forces to remove obstacles to investment and speed up the project."
The party also plans to push ahead with completing Sejong as the administrative capital for balanced national development. Pointing to a vicious cycle linking concentration in the capital region, regional decline and low birth rates, Kwon said, "The way to break this chain is region-led growth, and that starts with completing Sejong as the administrative capital." The party intends to speed up an amendment to the law on the multifunctional administrative city and related special legislation to support the relocation of central government agencies to Sejong.
Alongside efforts to broaden the growth base, the Democratic Party said it will respond forcefully to illegal financial crimes that threaten household finances. The party judges that damage to vulnerable groups squeezed by high interest rates and illegal debt collection has continued regardless of improvements in macroeconomic indicators.
Kim Han-kyu, the party's chief deputy floor policy leader, said at the meeting that the party is preparing a revision to allow undercover investigations and operations in which officers do not disclose their identity in cases of illegal private lending. The aim is to let investigators approach criminal organizations without revealing who they are, making investigations into illegal loans and debt collection more effective.
Kim referred to a case announced by the Gwangju Metropolitan Police Agency the previous day, in which two illegal lenders were detained and referred to prosecutors on suspicion of charging interest of up to 578% and conducting harsh debt collection. A self-employed person in their 50s who borrowed 40 million won ($28,000) from them repaid more than 50 million won in interest alone within just a few months, and took his own life in April after suffering illegal debt collection pressure. "It is a vicious crime that exploited the desperate circumstances of ordinary people," Kim said. "The share of illegal online lending has grown, and vicious practices such as so-called 'nude collection' continue." He added, "They use encrypted messengers and burner phones, so tracking them is difficult. That is why investigative methods must change as well."
The party plans to expand investigative tools for directly tracking criminal organizations, in addition to existing measures that limit the legal effect of illegal private lending contracts. "Even during the parliamentary audit period, we cannot pause on introducing bills for people's livelihoods," Kim said. "We will address problems through the audit and fix right away what can be fixed."