Hong Nam-ki "CPTPP, Target to Submit Membership Application During Moon Administration"

Press Conference with Foreign Journalists on the 15th

Hong on MSCI Advanced Index Inclusion
"Progressive Review of Allowing Offshore Free Trading of Won"

[Image source=Yonhap News]

[Sejong=Asia Economy Reporter Moon Chaeseok] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, stated on the 15th, "We are aiming to submit the application for accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) within the current (Moon Jae-in) administration's term."

"Goal to Submit CPTPP Accession Application Within Moon Administration"

Deputy Prime Minister Hong emphasized this during a press briefing with foreign correspondents held that afternoon. He declared the intention to promptly submit the accession application despite the many procedures following the application and the strong opposition from some sensitive sectors such as agriculture and fisheries, given that China and Taiwan have already submitted their applications.

He explained, "We will hold domestic meetings and public hearings in the future to prepare support measures for areas affected by liberalization and devise supplementary plans. We are continuing informal contact and consultations with the 11 CPTPP member countries, and overall, we are aiming to submit the CPTPP accession application within the current government."

He viewed the biggest obstacle as the issue of lifting the ban on Japanese seafood imports. He said, "Negotiations on sensitive sectors, mainly agricultural and fishery products, should be conducted within the scope of maximizing national interests, and the government should provide support for the areas that suffer damage. According to the response from Japan confirmed yesterday, Korea's CPTPP accession is not expected to be linked to diplomatic or judicial issues, but Japan may raise the issue of seafood from Fukushima, and we expect consultations to take place."

He also acknowledged that negotiations with Japan have not progressed quickly. He said, "There have not been many contacts, and there have been no significant achievements in contacts with Japan. Since the government has initiated the accession procedures, it takes time to gather opinions from stakeholders, and public hearings are also a legal procedure, but the overall stance is to officially submit the accession application within the Moon Jae-in administration."

For MSCI Developed Market Index Inclusion... "Progressive Review of Allowing Offshore Free Trading of KRW"

Hong mentioned that it is time to progressively consider establishing an offshore market where Korean won (KRW) can be traded 24 hours a day to be included in the Morgan Stanley Capital International (MSCI) Developed Market Index. He informed that after the investor relations (IR) event held in London on the 2nd (local time), discussions are underway among related ministries to improve systems and create conditions for re-inclusion in the index.

Hong said, "There have been demands for system improvements because foreign exchange market trading hours have been limited, and there have been criticisms that direct participation of foreign investors in the foreign exchange market is currently difficult. We are conducting a survey targeting more than 50 overseas securities firms and investors to understand their concerns and plan to review directions for system improvements."

Regarding whether offshore free trading of KRW will be allowed, he replied, "As we pursue inclusion in the MSCI Developed Market Index, conditions have changed significantly compared to before, so it is necessary to review this progressively. We need time to review the survey results by the end of this month and until around late January or early February next year."

He added, "The government will review its position by the end of January next year, contact overseas financial institutions to explain, and I intend to personally engage in contact with MSCI. When MSCI prepares the watchlist in June next year, we will have the opportunity to discuss system improvements. We are currently registering on the review list within the (Moon Jae-in) administration, and it is expected that the next government will actively proceed with inclusion in the MSCI Developed Market Index."

"Korean Domestic Economy Next Year May Be Affected by Omicron Variant"

Deputy Prime Minister Hong acknowledged that the recent spread of the Omicron variant could adversely affect the Korean economy, especially the domestic sector. He explained, "The recent increase in COVID-19 cases and the Omicron variant are expected to impact this year's economic management. Depending on how the situation unfolds next year, the domestic sector may be affected."

He said, "Exports are expected to continue the good trend from this year into next year, but if strict quarantine measures persist, the domestic economy will be negatively affected. The government also considers it important to end the quarantine situation early within a short period and is currently seeking support measures for small business owners who are facing immediate difficulties."

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