Presidential Office: "License Suspension for Non-returning Residents... Possible Medical School Enrollment Adjustment After 5 Years" (Comprehensive)

Sung Tae-yoon, Director of Policy Office, Reaffirms Principle-Based Response
"No Plans to Change Reinforcement Now"
"Continuing to Keep Dialogue Open"

Sung Tae-yoon, Chief of Policy Office at the Presidential Office
Photo by Yonhap News

As medical school professors nationwide have announced plans to submit collective resignation letters starting from the 25th, the Presidential Office stated that there will be no change to the plan to increase medical school admissions by 2,000 students annually from next year, and that the procedure for suspending resident licenses will proceed as scheduled. However, it suggested the possibility of adjusting the number of medical school admissions after five years, when the total increase reaches 10,000, if necessary.

Seong Tae-yoon, Policy Chief of the Presidential Office, appeared on KBS Sunday Diagnosis on the morning of the 24th and said, "By 2035, there will be a shortage of about 10,000 healthcare workers, and to fill this gap, it is necessary to produce about 2,000 personnel annually."

Seong stated, "After five years, if necessary, we can review (healthcare personnel), but at this moment, there is no plan to change this number."

He explained, "The number of doctors in our country is the second lowest including Korean medicine doctors, and the lowest among OECD countries excluding Korean medicine doctors. The actual required number was estimated to be about 3,000, but we thought that accepting about 2,000 would be feasible and could prevent deterioration of the current medical situation."

In particular, Seong added that the allocation of medical school student quotas by university next year reflects the government's intention to reduce regional medical disparities by concentrating placements outside the metropolitan area. He said, "Seoul was not allocated because the number of doctors per population is close to the OECD average. The number of doctors per 1,000 people in Seoul is 3.61, while the OECD average is 3.7."

On the other hand, he pointed out that the situation in Gyeonggi and Incheon, even though they are part of the metropolitan area, is different. Seong said, "People tend to think Gyeonggi and Incheon are similar to Seoul because they are in the metropolitan area, but the number of doctors per 1,000 people is 1.8 in Gyeonggi and 1.89 in Incheon, which is significantly low, indicating a considerable shortage of doctors." Accordingly, both Gyeonggi and Incheon were allocated quotas, but Seoul was not.

Presidential Office: "Cannot Avoid Following Legal and Procedural Principles"

Following the collective resignation of residents, with medical school professors nationwide also planning to submit collective resignation letters from the 25th, the confrontation with the government is expected to peak. The government reaffirmed that there will be no change in its principled response stance. The government announced that it will begin suspending licenses of residents who do not return despite work commencement orders starting this week.

Seong said, "The government hopes to avoid administrative and judicial sanctions as much as possible, but it is true that we cannot avoid following legal and procedural steps."

He also expressed concern about the nationwide medical school professors' planned resignation in protest against the medical school expansion policy. Seong said, "For residents to return, it would be helpful if professors work harder on teaching and medical care," emphasizing, "It is crucial that no incidents occur that jeopardize public safety, health, and life."

Seong added, "It is fortunate that even those submitting resignation letters have said they will continue to provide medical care. To prepare for any possible situations, we are reviewing various systems and making arrangements to ensure smooth emergency medical care, and we continue to keep dialogue channels open."

President Yoon Suk-yeol is inspecting fruit prices on-site while checking discounted apples supported by the Ministry of Agriculture, Food and Rural Affairs at the Nonghyup Hanaro Mart Yangjae branch fruit store in Seocho-gu, Seoul, on the 18th. From the right of President Yoon are Choi Sang-mok, Deputy Prime Minister for Economy and Minister of Strategy and Finance, and Song Mi-ryeong, Minister of Agriculture, Food and Rural Affairs.
[Photo by Yonhap News]

"Monitoring Possible Price Increases Due to Corporate Monopoly Power"

The Presidential Office explained that the government is implementing extraordinary measures in response to the recent sharp rise in grocery prices such as vegetables and fruits, and promised to strive to prevent the public from feeling the impact of price surges through continuous monitoring. In fact, prices of major items began to decline around March 14-15, and have been falling steadily since the 18th.

It also indicated that the government will closely examine price determinations that deviate from international raw material price trends such as oil prices.

Seong said, "(Prices) are closely linked to international raw material prices, and although price declines are occurring in the trend, if companies do not reflect this, there is a possibility that monopoly power is being exercised. For such items, the government can play a certain role," adding, "Since these are processed foods, it is not about 'lower all prices,' but about checking whether the actual raw material price trends are being reflected."

He pointed out, "If companies have some monopoly power, they can adjust the speed of price pass-through in a way that changes monopoly profits. It is desirable when prices rise, but it is undesirable when international raw material prices fall and there is room to lower prices but they remain unchanged." He further explained that since under-reflecting price decreases compared to increases can be problematic, the government will have a role to play.

Seong said, "Changes in corporate price-setting behavior mean that the Fair Trade Commission can increasingly play a role. This applies not only to food but also to products with monopolistic influence, such as the abolition of the Mobile Device Distribution Improvement Act (DanTongBeop)." He added, "Although the law's repeal requires parliamentary agreement and has not been achieved, we have taken legal effect measures through enforcement decrees. Strengthening competition and reducing benefits to monopolistic companies is important not only in telecommunications but in various sectors."

He continued, "It is also important for the government to manage specific items where price increases are felt by the public in a targeted manner."

[Image source=Yonhap News]

Seong Tae-yoon: "Lowering the Base Interest Rate Will Help Domestic Demand Recovery"

Amid the continued freeze of the Bank of Korea's base interest rate, Seong expressed the view that lowering the base interest rate in the future will aid domestic demand recovery.

Seong said, "I think changes in the base interest rate will significantly help (domestic demand recovery), but monetary policy is decided independently and neutrally, and the government does not intervene at all."

He added, "Recently, global supply shocks have eased, and as a result, the core inflation rate (excluding food and energy), which is influenced by monetary policy, has stabilized at around 2%. This creates an environment where interest rates can stabilize and be lowered. Even without immediate changes by monetary authorities, market expectations are forming, which will help domestic demand recovery and financial market stabilization."

When asked about the government's determination to resolve the Korea discount (undervaluation of the Korean stock market) and its achievements, he said, "Some results are appearing. The important factor is the flow of foreign investors, and the overall increase in foreign investor waiting funds suggests that they recognize the government's strong will to revitalize the asset market."

Seong said, "If policies create channels for corporate performance to translate more into capital market performance, it can be sufficiently reflected (in stock prices). Efforts to reduce tax burdens such as abolishing the financial investment income tax and improving corporate governance should be carried out together."

"No Possibility of Real Estate PF Crisis in April"

Regarding rumors of an 'April crisis' in the construction industry due to the real estate market downturn, Seong firmly stated, "There is absolutely no possibility of a crisis occurring in April."

He said, "Fortunately, the overall interest rate environment is significantly improving despite no changes in the base interest rate. If the overall environment changes, including base rate adjustments, it could improve further." He added, "Continuous monitoring is important, and supervisory authorities are thoroughly monitoring to prevent any issues during the 'bridge loan' process."

Regarding the recent rise in delinquency rates for mortgage loans, which constitute the largest portion of household debt, he said, "If the government suddenly tightens lending to manage risks, it can actually become more dangerous. It is important to check whether loans are being made in connection with income levels."

Seong said, "While DSR (debt service ratio) type loan regulations and loan soundness supervision are important, artificially regulating total loan volume is risky. We judge that risks related to mortgage loans are not significantly high, and cautiously expect that the household debt-to-GDP ratio will fall below 100% this year, unlike in the past."

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