Koo Yun-cheol: "Joint response to defend won and yen values"

Agreement reached at South Korea–Japan finance ministers’ meeting

To discuss currency swaps and more

Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol said the government will review joint action on exchange rates with Japan’s finance authorities, including an extension of the currency swap line.

At a briefing with correspondents held on the 14th at Japan’s Ministry of Finance in Tokyo, Koo said regarding the sharp fall in the value of the Korean won and Japanese yen that “we will consult with the (Ministry of Finance) if (joint) verbal intervention is needed.” He added, however, that “the fact that both the won and the yen have depreciated is due to external factors (the war in the Middle East), so how quickly the situation in the Middle East stabilizes is more important.” Ahead of the briefing, Koo held the 10th South Korea–Japan finance ministers’ meeting with Japan’s Finance Minister Katayama Satsuki and confirmed that appropriate measures should be taken against excessive exchange-rate volatility.

The two countries’ finance authorities also agreed to discuss ways to strengthen bilateral financial cooperation, including the currency swap line. The two sides signed a US$10 billion currency swap agreement in December 2023. The contract term is three years and is set to expire this November. Regarding an extension, Koo said, “We need to take a comprehensive look at various circumstances,” while adding that he would “consult with Japan on the (currency swap) size and term.”

Koo and Minister Katayama also pledged close cooperation to ensure stable energy supplies in connection with the situation in the Middle East. They also discussed cooperation in artificial intelligence (AI) to support growth in both countries. On economic security, Koo said the two sides agreed to join forces to diversify supply chains for key minerals such as rare earths.

Tokyo=Correspondent Kim Il-gyu black0419@hankyung.com