[Person人] Jo Yoon-je, who coordinated the 2003 revision of the Bank of Korea Act... 'A Warm Market Advocate'

Jo Yoon-je, New Member of the Financial Monetary Policy Committee at the Bank of Korea

Governor-Level Monetary Policy Committee Member with Experience as Ambassador to the U.S.
Central Bank Faces Unprecedented Challenges Amid COVID-19 Crisis

[Image source=Yonhap News]

[Asia Economy Reporter Eunbyeol Kim] In the spring of 2003, there was intense controversy over the revision of the Bank of Korea Act to strengthen the independence of the central bank. Through the revision at that time, the Deputy Governor of the Bank of Korea became an ex officio member of the Monetary Policy Committee, and the Securities Industry Association's right to recommend Monetary Policy Committee members was abolished. One private recommendation right disappeared, and the number of Monetary Policy Committee members from the Bank of Korea increased by one. Naturally, the Bank of Korea welcomed the bill as soon as it was proposed in the National Assembly because its authority was expanded, but the government strongly opposed it. The gap seemed unbridgeable, but at some point, both sides met and created a unified plan. The revision bill of the Bank of Korea Act, which had been dragged on for about four months, was eventually passed that summer. The person in the middle of this was the newly appointed Monetary Policy Committee member Jo Yoon-je, who took office on the 21st (he was an economic advisor to the Blue House during the Roh Moo-hyun administration). The person who coordinated the work of changing the composition of the Monetary Policy Committee came to the Bank of Korea as a Monetary Policy Committee member after 17 years.

Cha Hyun-jin, a professor at the Bank of Korea Human Resources Development Institute who was dispatched to the Blue House at the time, said, "I was impressed by how he played a rational role in coordinating the revision of the Bank of Korea Act between bureaucrats and the Bank of Korea," adding, "As an economic advisor, I remember feeling that he had great affection and interest in the Bank of Korea by serving as a bridge between the Bank of Korea and the government. I think his connection with the Bank of Korea started from then."

The reason Jo’s name is familiar is that he previously served as the Ambassador to the United States from 2017 to 2019. At that time, he appeared frequently in the media, briefing several times on the progress of North Korea-U.S. working-level talks as North Korean Supreme Leader Kim Jong-un and U.S. President Donald Trump began dialogue. Therefore, he is known as the 'Ambassador to the U.S.,' but those who have known Jo for a long time unanimously describe him as an 'economist,' 'scholar,' and 'not a political figure.' A Bank of Korea official said, "Rather than the ambassador position, I think he would be proud to serve as a Monetary Policy Committee member as someone who has devoted his life to economics," adding, "I understand that he clearly expressed his economic views even when participating in international conferences." He also said, "Especially at a time when there is talk about the central bank’s role needing to change due to the novel coronavirus disease (COVID-19), his role is even more important."

Jo graduated from Kyunggi High School and Seoul National University, and earned his master's and doctoral degrees in economics from Stanford University in the United States. Afterwards, he worked as an economist at the World Bank (WB) and the International Monetary Fund (IMF), served as deputy director of the Korea Institute of Public Finance, and was an advisor to the Minister of Finance and Economy just before the foreign exchange crisis. During the Roh Moo-hyun administration, he served as an economic advisor to the Blue House. In 2016, he became the head of the think tank 'Policy Space for National Growth,' which can be considered President Moon Jae-in’s presidential campaign policy camp, and drew the blueprint for the current administration’s economic policy. This is why he earned the nickname 'President Moon’s economic teacher.' This shows his deep connection with the current government. Having served as ambassador to the U.S. with ministerial status, there is also talk of him being a 'governor-level Monetary Policy Committee member.'

So what about his economic stance? Professor Cha described him as a 'Keynesian.' He does not believe that everything can be solved by leaving it all to market logic. It is said that he has consistently argued that active government intervention is necessary when market logic does not work. He is also very interested in welfare and distribution. A government official said, "He is a person who places great importance on welfare and distribution," adding, "He is someone who values the market but also has a warm heart and is very interested in the role of fiscal policy."

However, he is not someone who completely ignores market logic. He believes in the market but thinks that the government should actively intervene and guide the direction when necessary. Globally, there have been many cases where central banks and fiscal policies have had to coordinate due to COVID-19, and it is a point of interest what views Jo holds on this matter. A government official who frequently received reports from Jo when he was an economic advisor to the Blue House said, "Whether the views matched his or not, he listened carefully until the end and tried to take a middle ground," adding, "Among the Blue House senior secretaries who came politically, some only expressed their own opinions, but Jo was not like that."

Meanwhile, as the economy is in an emergency situation due to COVID-19, Jo faces the task of exploring a new role for the central bank. After the COVID-19 outbreak, the Bank of Korea lowered interest rates to the 0% range for the first time in history and embarked on 'Korean-style quantitative easing' through unlimited RP (repurchase agreement) purchases. For the first time since the foreign exchange crisis, it also extended loans to non-bank entities such as securities firms. There are many forecasts that cooperation between monetary policy and government policy will be further strengthened. At the inauguration ceremony held at the Bank of Korea headquarters the day before, Jo said, "The global economy is in great turmoil, and the Korean economy is facing considerable challenges due to structural changes that have continued so far," adding, "Furthermore, due to the recent COVID-19 outbreak, the domestic and international economies are in an emergency situation." He then expressed his feelings, saying, "I feel a heavy responsibility in taking on the role of a Monetary Policy Committee member at such a time." He added, "As one of the Monetary Policy Committee members, I will continue to study and do my best to support monetary policy so that the Korean economy can maintain a stable and sustainable growth process."

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