Hong Nam-ki: "External Financial and Foreign Exchange Market Volatility Relatively Stable Compared to Crisis"

At the 218th Foreign Economic Ministers' Meeting

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is delivering opening remarks while presiding over the "218th Ministerial Meeting on External Economic Affairs" at the Government Seoul Office in Gwanghwamun, Seoul, on the 14th.

[Asia Economy Reporter Joo Sang-don] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, assessed on the 14th that "the volatility of external financial and foreign exchange markets is relatively stable compared to previous crises."

On the same day, Deputy Prime Minister Hong made this statement while presiding over the '218th Ministerial Meeting on External Economy' at the Government Seoul Office.

Hong explained, "A case in point is the government's successful issuance of $1.45 billion in Foreign Exchange Stabilization Fund Bonds (Oe-pyeong-chae) in overseas markets on the 10th at historically low interest rates," adding, "The spread on dollar-denominated bonds was 50 basis points, which is even lower than the pre-COVID-19 level, and the euro-denominated bonds were issued at a negative interest rate (-0.059%), marking the first time for a non-eurozone country."

He expressed expectations that the successful issuance of these Oe-pyeong-chae bonds would yield various direct and indirect effects. Hong said, "First, foreign exchange reserves were expanded at minimal cost, and as the benchmark Oe-pyeong-chae spread declined, it is expected that the foreign currency procurement costs for domestic companies and financial institutions will also decrease," adding, "This reconfirms overseas investors' strong trust in Korea's COVID-19 response, economic crisis management, and the fundamentals such as external soundness. In the current global crisis situation, such indirect effects carry even greater significance."

At the meeting, the agenda included ▲Utilization of non-face-to-face and online trends and support performance and future tasks for SME exports ▲Trends and response directions regarding anti-dumping duties against Korea ▲Plans for Korea-Uzbekistan economic cooperation and trade agreement promotion.

Hong emphasized, "In the second quarter of this year, online exports by SMEs increased by 128.9%, showing that non-face-to-face and online exports significantly contributed to the recovery of SME exports," and added, "Support measures have been prepared to accelerate this recovery trend." The government plans to strengthen the integration between online and offline channels by linking large companies' local distribution networks with SMEs' online sales channels, and establish a linkage system that allows popular products from domestic shopping malls to be easily sold on seven major overseas online malls including Amazon. Additionally, to promote 'Brand K,' the national representative brand for SMEs, support will be provided for connections with various online channels such as local home shopping and live commerce, and an export support system utilizing big data will be introduced to analyze the competitiveness of Korean SMEs and assist in preparing customized market entry strategies for promising markets.

With the global expansion of protectionism, investigations and measures on anti-dumping duties against Korean companies are increasing and expanding. As the burden on companies is expected to grow, the government plans to establish an inter-ministerial 'Anti-Dumping Duty Response Task Force (TF)' and collaborate through public-private joint responses. In terms of enhancing public-private response capabilities to import regulations, legal advisory support for SMEs' responses to import regulations will be increased from about 1.5 billion KRW this year to 2 billion KRW next year.

The government also plans to pursue tangible outcomes and creation of bilateral economic cooperation projects with Uzbekistan, a key partner in the New Northern Policy along with Russia and Mongolia. Following the Korea-Uzbekistan Deputy Prime Minister meetings in May and July, a list of about 90 joint investment projects under discussion will be selected, and plans will be made to expand the Economic Development Cooperation Fund (EDCF) basic agreement (currently $500 million) and support the creation of the Angren Free Economic Zone advanced industrial complex to further specify bilateral economic cooperation projects. Furthermore, based on the completion of joint research (July 6) and public hearings (July 31) on the Korea-Uzbekistan trade agreement aimed at creating new trade demand and expanding promising cooperation sectors, domestic procedures including reporting to the National Assembly will be finalized within this month, and negotiations for the Korea-Uzbekistan trade agreement are planned to commence within the year.

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