The Korea Venture Business Association, KOSDAQ Association, and Korea Venture Capital Association held a press conference on the 30th at the Korea Federation of Small and Medium Enterprises in Yeouido, Seoul, to propose policies for revitalizing the KOSDAQ market.
As the government unveiled its blueprint for a KOSPI 5000 era, the KOSPI index has surpassed 3200 points, continuing its rally. The KOSDAQ market also needs innovative policies to fulfill its role as a gateway for venture businesses and a source of venture capital, working towards an era of 'KOSDAQ 3000'.
To this end, the three organizations held this meeting to convey policy proposals for revitalizing the KOSDAQ market, reflecting the voices from the field from the perspectives of companies preparing for listing (the Korea Venture Business Association), listed companies (the KOSDAQ Association), and investors (the Venture Capital Association).
The KOSDAQ market, established in 1996, is the second growth stock-centered market founded in the world after the U.S. NASDAQ, and it gained attention as its average daily transaction amount surpassed that of the KOSPI just four years after its launch. However, the current KOSDAQ index remains about 800 points, 20% lower than at its inception, and is diagnosed to have entered a prolonged period of stagnation along with an unactivated recovery market.
The key policy suggestions made that day included ▲ establishing principles for KOSDAQ operations ▲ enhancing liquidity supply ▲ presenting a policy vision from the government. The Korea Venture Business Association emphasized the need to improve the KOSDAQ structure with a market-centered approach. They proposed introducing a private-sector-driven accountable listing structure to enhance the responsibilities and roles of underwriters, as well as transitioning to a qualitative screening system focused on growth potential. Additionally, they called for the government to establish a policy vision and roadmap for achieving the KOSDAQ 3000 era by reorganizing the delisting system and revitalizing restructuring to create a dynamic market environment of 'many births and many deaths.'
The KOSDAQ Association requested an expansion of institutional investment in the KOSDAQ market and long-term investor incentives. They argued that it is necessary to induce participation from institutional investors in the KOSDAQ market and, specifically, to expand the investment proportion of the National Pension Service in accordance with the market's market capitalization ratio. They also proposed strengthening tax incentives, such as lowering the dividend tax rate for long-term investors.
The Korea Venture Capital Association argued for the introduction of a KOSDAQ revitalization fund. They proposed creating a 'KOSDAQ revitalization fund' totaling 30 trillion won over three years at an annual rate of 10 trillion won to supply liquidity to the KOSDAQ market and induce a shift towards an institutional investor-centered structure. This fund would be established through contributions from the government and policy financing institutions along with incentives for increasing participation from private investors. The association demanded policy support to ensure it effectively supplies venture capital to venture businesses and small innovative enterprises.
Song Byeong-jun, chairman of the Korea Venture Business Association, emphasized, "Now is the time to establish a new role for the KOSDAQ market to open the KOSDAQ 3000 era," stating, "The stagnation of the recovery market is ultimately blocking the virtuous cycle of startups and investment, and structural improvements to the KOSDAQ with a market-centered approach are absolutely necessary." He also noted, "I hope the government will present a policy roadmap through discussions with relevant departments such as the Ministry of Small and Medium Enterprises and Startups and the Financial Services Commission to restore the KOSDAQ market's original identity as a 'growth stock-centered market' that values corporations' future growth potential and technological capabilities, among other intangible assets."