Deputy Prime Minister and Minister of Economy and Finance Koo Yun Cheol attended the International Monetary and Financial Committee (IMFC*) meeting in Washington, D.C. on October 17, in his capacity as Governor representing Korea on the IMF Executive Board. On the sidelines of the meeting, DPM Koo also held bilateral meetings with World Bank President Ajay Banga, IMF Managing Director Kristalina Georgieva, and Global Head of Sovereign Ratings at Fitch Ratings James Longsdon.
* As an advisory body to the IMF Board of Governors, the Committee is composed of 25 Governors from member states and meets twice a year, in April and October.
Above all, DPM Koo attended the IMFC meeting to exchange views with finance ministers and central bank governors from major economies on the IMF’s policy direction, as well as current global economic challenges and policy responses.
Amid sluggish global growth, high debt levels, and intensifying geopolitical uncertainty, the IMF emphasized the need for countries to pursue sustainable growth through fiscal consolidation and productivity enhancement. It presented its Global Policy Agenda (GPA*), outlining its policy direction for the coming period with a view to strengthening tailored policy advice and financial support to help member countries safeguard macroeconomic and financial stability.
* The IMF’s biannual policy framework released each April and October.
DPM Koo commended the IMF’s policy direction and called on the Fund to conduct more refined analyses of the spillover effects of major policies, such as trade, as well as medium- to long-term challenges including digitalization. He also requested that the IMF provide country-specific policy recommendations to better support members’ policy responses. He further emphasized that overcoming the current challenges of low growth and high debt ultimately depends on each country’s own efforts, highlighting Korea’s AI Transformation and Ultra-Innovative Economy strategies as exemplary initiatives aligned with the IMF’s call for private sector-led efforts to raise potential growth.
On the same day, DPM Koo held a meeting with World Bank President Ajay Banga. Both sides agreed that the responsible and effective utilization of AI can serve as a powerful tool to enhance productivity and improve the quality of life in developing countries, and concurred on the need to expand cooperation between Korea and the World Bank in this area. In particular, during the Annual Meetings, an administrative agreement for a Korea-funded digital development trust fund was signed, which is expected to act as a valuable platform for substantive AI collaboration between the two sides. DPM Koo also asked President Banga to focus on expanding the recruitment of Korean professionals and increasing the share of Koreans in senior positions at the World Bank to further reinforce bilateral cooperation.
DPM Koo also met with Global Head of Sovereign Ratings at Fitch Ratings James Longsdon. During the meeting, DPM Koo shared Korea’s key policy initiatives – including the AI Transformation and the Ultra-Innovative Economy – aimed at enhancing the country’s growth competitiveness, along with the government’s plans for proactive fiscal investment to support these efforts. He explained that such initiatives are expected to bolster Korea’s growth potential and contribute to the long-term sustainability of public finances. The Fitch representatives expressed appreciation for DPM Koo’s detailed briefing, noting that it provided valuable insights for the agency’s assessment of the Korean economy. They also showed keen interest in Korea’s economic outlook and fiscal policy stance.
Last but not least, DPM Koo met with IMF Managing Director Kristalina Georgieva to present Korea’s economic growth strategy with a view to implementing the AI Transformation and the Ultra-Innovative Economy. He explained that Korea is promoting productivity innovation through nationwide AI education, expanded data accumulation, and the development of language models applicable across various sectors, including biotechnology. He also stressed that Korea is creating new AI-driven growth engines through bold investments in ultra-innovative technologies, including semiconductors, small modular reactors (SMRs), and green hydrogen, as well as by fostering public-private partnership ecosystems. Managing Director Georgieva positively evaluated the new government’s economic and fiscal policy direction as consistent with the IMF’s recommendations, and expressed appreciation for Korea’s support for the 16th General Review of Quotas (GRQ*) intended to strengthen the global financial safety net.
* A quinquennial review of IMF quotas; during the 16th review, a reform plan was approved in December 2023 to expand total quotas by 50%, requiring consent from 85% of member countries for implementation.
Please refer to the attached files.
