G20 Finance Ministers’ Meeting, Venice
DPM HONG Has Bilateral Talks With US Treasury Secretary Yellen and IMF Managing Director Georgieva
Talks with US Treasury Secretary
Deputy Prime Minister Hong Nam-ki had bilateral talks with US Treasury Secretary Janet Yellen on July 9 on the sidelines of the G20 Finance Ministers’ Meeting held in Venice, Italy. At the talks, the two leaders discussed follow-ups to the recent Korea-US summit outcomes, seeking closer cooperation on both bilateral and multilateral issues.
Bilateral issues
DPM Hong acknowledged the extension of the dollar-won currency swap deal and said that Korea is willing to cooperate on US’s Build Back Better World (B3W)[1], as well as working together on the outcomes[2] of the Korea-US summit held last May. DPM Hong added that Korea’s southeast Asian initiative, New South, and US’ Indo-Pacific Strategy can take advantage of each other and help accelerate B3W.
US Treasury Secretary Yellen welcomed Korea’s willingness to help with B3W and agreed on cooperation on follow-ups to the summit outcomes. The two sides also talked about dealing with Iranian funds in won.
The two leaders also discussed multilateral issues of climate change response, Inclusive Framework on BEPS[3] and IMF SDR redistribution.
Climate change response
DPM Hong explained Korean government’s efforts toward 2050 carbon neutrality, including those to raise the NDC[4] target, and US Secretary of Treasury Yellen acknowledged Korea’s decision not to expand support for coal fired power plants and talked about the need to promote private participation in GCF[5] and strengthen the fund, on which DPM Hong agreed and pledged cooperation.
Inclusive Framework on BEPS
The two finance chiefs shared their positive views on the inclusive framework on BEPS, exchanged their thoughts on details for future discussions, and agreed to work together for appropriate outcomes.
IMF SDR redistribution
Korea’s deputy prime minister said the country would be ready to participate in the SDR redistribution, and US treasury’s Yellen welcomed the offer. The two leaders shared the view that the redistribution should be designed in a way that it will have more countries voluntarily participate in it.
Talks with IMF Managing Director
DPM Hong also had talks with IMF Managing Director Kristalina Georgieva on July 10. The two leaders shared their views on the global and Korean economies, and discussed the role of IMF on the road to recovery and restructuring. IMF’s Georgieva talked about IMF’s focus of transforming economies into digital and green ones, and asked for the sharing of information and experience Korea have gained through the Korean New Deal. DPM Hong thanked for IMF’s leadership in global economic recovery and restructuring, and asked for continuing support and suggestions for the Korean economy.
DPM Hong explained Korea’s participation in global disease prevention efforts and climate change response, including US$ 200 million contributions to COVAX AMC[6], and IMF Managing Director Georgieva readily acknowledged the country’s efforts.
IMF’s Georgieva inquired Korea’s stance on the SDR redistribution, and Korea’s economy head showed positive attitude towards the redistribution and the expansion of the Poverty Reduction and Growth Fund, saying that Korea will actively participate in the redistribution.
With regard to the IMF review of capital flows[7], DPM Hong called for flexibility reflecting different situations each country is faced with. The IMF managing director said the institutional review is based on past performance of each country, and asked for the sharing of Korea’s Macro-prudential measures, including a ceiling on FX derivatives positions.
[1] Over US$ 40 trillion worth of investment in developing countries’ infrastructure building by 2035
[2] Pledges on closer cooperation in vaccine development, supply chains, high technology development, climate change response and exchanges of human resources
[3] Base erosion and profit shifting
[4] Nationally Determined Contributions
[5] Green Climate Fund
[6] COVID-19 Vaccines Global Access Advanced Market Commitment
[7] The Institutional View on the Liberalization and Management of Capital Flows
Please refer to the attached PDF
