Hong Nam-ki "IMF Should Consider Allocating Special Drawing Rights for COVID-19 Response"

Deputy Prime Minister Hong Attends IMFC Emergency Video Conference
"Procedures Must Be Simplified for Swift Financial Support"

Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki is holding a video conference of the International Monetary and Financial Committee (IMFC) related to the novel coronavirus infection (COVID-19) at the Government Seoul Office Building on the evening of the 27th.
[Image source=Yonhap News]

[Asia Economy Reporter Jin-gyu Lee] Deputy Prime Minister and Minister of Strategy and Finance Hong Nam-ki proposed that the International Monetary Fund (IMF) should consider allocating Special Drawing Rights (SDR) to respond to the spread of the novel coronavirus disease (COVID-19).

SDR refers to foreign reserve assets issued by the IMF and allocated to member countries. It is a currency basket composed of the dollar, euro, yuan, yen, and pound.

According to the Ministry of Strategy and Finance on the 28th, Deputy Prime Minister Hong stated at the International Monetary and Financial Committee (IMFC) meeting held via video conference the day before, "The IMF must prioritize support for countries severely affected by COVID-19." He also urged, "The processing procedures should be simplified to enable rapid financial support to countries that have made urgent requests for assistance."

He mentioned, "The relatively short time taken to enter a stabilization phase without extreme measures such as restrictions on human and material movement was due to early detection of confirmed cases through extensive testing, blocking the inflow of infection sources via special entry procedures, transparent information disclosure, and an innovative quarantine system utilizing ICT such as self-diagnosis apps."

He added, "To respond to the economy, we are promoting a policy package worth a total of 132 trillion won, including 32 trillion won in fiscal and financial support through supplementary budgets and over 100 trillion won in financial support recently prepared to supply corporate liquidity." Furthermore, he said, "We will continue to devise unprecedented measures in line with the global pandemic situation."

Kristalina Georgieva, IMF Managing Director, stated, "Due to COVID-19, the global economy is likely to experience a recession on the scale of the global financial crisis this year," and "additional policy support from member countries is necessary, and the IMF will make every effort to support affected countries." Managing Director Georgieva also said, "We are preparing strong measures to respond to COVID-19, which will be discussed at the IMF Spring Meetings scheduled for April 16."

Meanwhile, the IMFC is an advisory body to the IMF Board of Governors composed of representatives from 24 IMF member countries. Although Korea is not a member country, it was invited along with Indonesia, Singapore, and Spain. The IMFC usually meets twice a year, but in response to the COVID-19 outbreak, it was urgently convened for the second time this month following the meeting on the 4th and was held remotely.

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