First Korea-Japan Finance Dialogue
The two Ministers exchanged views on the outlook for the world and Asian economies. On the world economy, they welcomed that the global economy continues to trace a growth path. They expect this to remain unchanged, although they noted some risk factors, such as high oil prices, interest rate rises, and the avian flu. In this context, they recognized the need to cooperatively respond to those risk factors to the global economy. On the Asian economy, the two parties were pleased to note the region’s strong growth last year,and they expected that the solid growth in the region as a whole will continue again this year.
The Korean economy has experienced a steady recovery following the return of domestic demand and private consumption complementing continuously strong export performance. Growth near potential level will be maintained on the back of the domestic demand-export equilibrium. Nevertheless, the government needs to strengthen the systematic efforts to respond to future risk factors such as economic and social disparities, low fertility, and ageing society.
The Japanese side highlighted that its economy is recovering at a moderate pace, led by domestic private demand. Resilience in the corporate sector is spreading to the household sector through the improvement of the employment and income situation. Overcoming deflation and fiscal consolidation are recognized as the two major agenda items which the Japanese economy faces at the current juncture.
Through these exchanges on economic policy directions in both countries, The two Ministers agreed to further strengthen cooperation at the International Financial Institutions and in international and regional fora such as ASEAN+3 Finance Ministers’ Meeting. In this context, they in particular underscored the critical importance of achieving concrete progress on the IMF quota reform by the next IMF and World Bank Annual Meetings in Singapore. They also agreed to continue their close cooperation in contributing to international efforts at the Financial Action Task Force (FATF) and other multilateral fora to counter terrorist financing.
The two Ministers agreed to conclude the second bilateral swap arrangement (BSA) under the Chiang Mai Initiative (CMI). The new "two-way" BSA will enable the two countries to swap their local currencies (i.e. Korean won or Japanese yen) against US dollars. Under the arrangement, Japan commits USD10 billion while Korea commits USD 5 billion. This new BSA is expected to strengthen the CMI’s role of balance of payment support or short-term liquidity support. They also stressed the importance of completing the CMI review to enhance its effectiveness by the next ASEAN+3 FMM in May. Furthermore, the Ministers agreed to play a pivotal role to accelerate the Asian Bond Markets Initiative (ABMI) process. Recognizing that the first issuance of the Pan-Asia Bond in December 2004 was beneficial for bond market development in the region as well as in the two countries, they agreed to continue the joint efforts in this field.
Looking ahead, the two Ministers shared the view that both countries face the same challenges of the population ageing and the enhancement of competitiveness under economic globalization. In order to cope with these challenges with significant implications on macroeconomic, fiscal, and tax policies, the two Ministers agreed on the need to continue the ongoing structural reforms of the public sector in each country. In particular, they put emphasis on the importance of fiscal consolidation for sustainable economic growth as well as supported by appropriate expenditure and revenue measures. They also agreed to closely cooperate on improving the efficiency of debt management with a view toward securing effective and stable means of financing and minimizing mid- and long-term financing costs. Furthermore, they agreed on the importance of advancing science and technology and improving education. They also agreed on the need to pay appropriate attention to ensuring a sustainable social security system as the social safety net.
Four Director-General Sub-meetings were held separately to further exchange views and to intensify cooperation in the following four policy areas: macroeconomic policy, budget policy, tax policy, and government debt management policy.
At the end of the first Finance Dialogue, the two Ministers concluded that the Finance Dialogue was very enlightening and fruitful. They also expressed their willingness to further enhance timely communication and contact between the two Ministries in a deeper and wider manner through their staff at various levels and in various fields.
The Korean Finance Minister expressed his appreciation to the Japanese Finance Minister and the Ministry of Finance of Japan for their warm hospitality and excellent arrangement for hosting the first bilateral Dialogue. The second Korea-Japan Finance Dialogue at the Ministerial level will take place in Korea in 2007.
올인원 PR 플랫폼
딱 맞는 기자를 쉽게 찾아 보도자료를 기사로 만드세요
-
2008년 10월 6일 16:30
