Lee: "High Possibility of Won Becoming a Key Currency"... Lee Jun-seok: "My Heart Swells with Pride"

Lee Jun-seok Criticizes "Talk of Creating a Reserve Currency to Solve National Debt"
Federation of Korean Industries Released Report on 13th Stating "Won Could Be Included as SDR Currency"
Some Differences from General Meaning of 'Reserve Currency'
Won Ranks Outside Top 20 in International Currency Settlement Ratios

Lee Jae-myung, the Democratic Party presidential candidate (left), and Ahn Cheol-soo, the People's Party presidential candidate, are preparing for the debate at the first invited debate for the 20th presidential election hosted by the National Election Broadcasting Debate Commission, held on the afternoon of the 21st at the MBC Media Center Public Hall in Mapo-gu, Seoul. / Photo by Yonhap News

[Asia Economy Reporter Lim Juhyung] Lee Jae-myung, the presidential candidate of the Democratic Party of Korea, claimed during a legal TV debate on the 21st that "there is a very high possibility that we will soon become a key currency country," prompting immediate criticism from opposition parties. Lee Jun-seok, leader of the People Power Party, sarcastically remarked, "My heart swells with pride."

On the 21st, Lee Jun-seok pointed out on his Facebook post, "This is a story about making our country a key currency country to solve national debt."

In the early hours of the next day, he posted again, saying, "Regarding Candidate Lee's claim of pursuing key currency status, the Democratic Party explained by citing data from the Federation of Korean Industries (FKI) that there is a possibility of becoming a key currency country," adding, "Not long ago, the Korean Confederation of Trade Unions declared support for Candidate Lee Jae-myung. A wonderful candidate who plans the big picture of the economy with the support of the Korean Confederation of Trade Unions and the ideas of the FKI," strongly criticizing him.

He further added, "While saying that the Korean won will be made a key currency, he even plans to issue mysterious real estate tokens and distribute them like public shares, which seems like an intention to devalue legal tender and turn the people's financial assets into worthless scraps."

Lee Jun-seok, Leader of the People Power Party / Photo by Yonhap News

The controversial 'key currency country remark' came during the '1st Debate for the 20th Presidential Election Candidates' hosted by the National Election Commission's Debate Commission at 8 p.m. the previous day. On that day, Candidate Lee clashed with Ahn Cheol-soo, the candidate of the People’s Party, over national debt management issues.

When Candidate Ahn first asked, "Do you remember saying that our country's debt ratio (relative to GDP) can exceed 100%?" Candidate Lee replied, "The intention was that it would not cause significant problems even if it did."

Then Candidate Ahn asked again, "Do you know the difference between a key currency country and a non-key currency country?" To which Candidate Lee responded, "Of course I do. Our fundamentals are strong enough that we can say there is a high possibility of joining the key currency countries."

Candidate Ahn said, "Optimistically, we can develop and become a key currency country," but pointed out, "The problem is that we are not in that position now. Fiscal management should be cautious and conservative."

As online controversy grew over Candidate Lee's remarks, the Democratic Party's election campaign public relations team explained, "They cited content from a press release distributed by the Federation of Korean Industries on the 13th."

50,000 won bill. / Photo by Yonhap News

Earlier, on the 13th, the Federation of Korean Industries released a report stating that "the Korean won has qualified to be included in the International Monetary Fund (IMF) key currency basket." Specifically, it explained that the won could be included as one of the currencies composing the Special Drawing Rights (SDR) currency basket reviewed by the IMF Executive Board this year.

However, there is likely to be debate over whether the inclusion of the won in the SDR currency basket can be equated with the commonly used meaning of 'key currency.'

SDR is a right that IMF member countries can draw upon without collateral during foreign exchange crises. Currently, it consists of five currencies: the US dollar, the euro of the Eurozone, the Japanese yen, the British pound, and the Chinese yuan.

Meanwhile, in the general sense, a key currency refers to a currency used in international trade and financial settlements instead of gold. According to the Society for Worldwide Interbank Financial Telecommunication (SWIFT) data on international settlement currency ratios, the most used currency in global international settlements over the past year was the US dollar, accounting for as much as 40.51%.

The euro ranked second with 36.65%, followed by the pound (5.89%), yuan (2.7%), and yen (2.58%). The won ranked lower than the Mexican peso (0.22%) and the Russian ruble (0.21%), failing to make it into the top 20.

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