Minister of Industry Holds Unprecedented Meeting with Bank of Korea Governor to Discuss Economic Issues

Minister Lee Chang-yang Meets with Governor Lee Chang-yong on the 28th

On the 28th, Lee Chang-yang, Minister of Trade, Industry and Energy (left), and Lee Chang-yong, Governor of the Bank of Korea (right), held a meeting at the Chosun Hotel in Jung-gu, Seoul.
[Photo by Ministry of Trade, Industry and Energy]

[Asia Economy Sejong=Reporter Lee Jun-hyung] Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy and Governor Lee Chang-yong of the Bank of Korea met to discuss economic issues.

The Ministry of Trade, Industry and Energy announced that Minister Lee held a meeting with Governor Lee on the morning of the 28th at the Chosun Hotel in Jung-gu, Seoul, to discuss recent economic trends. The two checked the real economy situation amid the "three highs" phenomenon (high inflation, high interest rates, and high exchange rates).

It is unusual for the Minister of Trade, Industry and Energy and the Governor of the Bank of Korea to have an official meeting, as there is no direct overlap between the Ministry, which handles the real economy, and the Bank of Korea, which implements monetary policy. However, the Bank of Korea’s base rate hikes increase corporate burdens and may lead to economic slowdown, creating indirect effects between the two entities.

The unusual meeting between the Minister and the Governor is interpreted as reflecting the government’s sense of crisis regarding the recent economic situation. In particular, the Ministry is focusing all efforts on export revitalization measures as the trade balance has recorded deficits for seven consecutive months for the first time in 25 years since the 1997 foreign exchange crisis. Another challenge for the Ministry is that Korea Electric Power Corporation, trapped in a "deficit swamp," is continuously issuing AAA-rated corporate bonds, exacerbating the tightening of the financial market.

Meanwhile, Minister Lee and Governor Lee reached a consensus on the need for active communication and cooperation between the Ministry and the Bank of Korea to overcome the economic crisis. Accordingly, the Ministry and the Bank of Korea agreed to maintain close communication in the future to share economic situation updates.

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