[Reporter’s Notebook] Financial New Deal Evokes Memories of a 'Mobilization Order'

Photo by Minyoung Kim

[Asia Economy Reporter Kim Min-young] "'Korean New Deal' project acceleration and full-scale investment" "Actively supporting the success of the Korean New Deal" "Financial support of 13.08 trillion won planned for K-New Deal."

On the 3rd, immediately after the 1st Korean New Deal Strategy Meeting chaired by President Moon Jae-in at the Blue House, major domestic financial holding companies released press release headlines. Judging by the titles alone, it is hard to tell which financial company issued the release, as they are all similar and unanimously state plans to invest tens of trillions of won for the success of the Korean New Deal.

The five major financial holding companies?Shinhan, KB, Hana, Woori, and NH Nonghyup?have consecutively announced New Deal financial investment plans. KB Financial announced it will support 10 trillion won by 2025 for the Korean New Deal’s Green Smart School and digitalization of public safety social overhead capital (SOC). Hana Financial also decided to invest 10 trillion won in Korean New Deal projects such as the Digital New Deal and Green New Deal.

Woori Financial further specified its 10 trillion won scale New Deal-related financial support plan announced last month. NH Nonghyup Financial will provide a total of 13.8 trillion won in New Deal support through loans and investments.

However, these financial companies had previously announced investment plans worth tens of trillions of won. KB Financial declared it would spend 66 trillion won supporting innovative finance, and Hana Financial formed an Innovative Finance Council and established a 50 trillion won financial support plan over five years. Shinhan Financial plans to announce a new investment plan on the 7th in addition to the previously announced 28.5 trillion won in loans and investment support. Within the banking sector, there are rumors of a "surprisingly large investment plan announcement."

The investment plans set by these financial companies total 144.5 trillion won. With an additional 43.8 trillion won announced in a single day, the scale of New Deal financial support reaches 188.3 trillion won.

Some voices criticize the financial companies for suddenly announcing tens of trillions of won in investment plans as if to show off to the government, saying it seems like "betting by increasing the stakes in a gambling game." A financial sector official warned, "Investment plans are still business plans, but why are they expanding so rapidly? If autonomy is excluded and speed is prioritized, serious problems could arise."

The financial companies themselves express frustration. They feel compelled to invest reluctantly under government pressure without being able to consider business feasibility. Another official lamented, "I understand the government pressured the financial sector early on to submit plans related to New Deal funds. The reality is that we have no choice but to be dragged into government-led projects that lack specificity."

This content was produced with the assistance of AI translation services.