Gu Yoon-cheol and Lee Chang-yong Put Their Heads Together... "Seeking the Optimal Policy Mix"

[Financial News] Gu Yoon-cheol, Deputy Prime Minister for Economic Affairs and Minister of Strategy and Finance, visited the Bank of Korea for the first time since taking office and solidified his commitment to communication by stating, "We will become a one-team for the Korean economy." Lee Chang-yong, Governor of the Bank of Korea, also positively evaluated the results of the Korea-U.S. customs negotiations led by Deputy Prime Minister Gu and expressed his willingness to cooperate in restructuring.
 Deputy Prime Minister Gu visited the Bank of Korea in Jung-gu, Seoul, on the morning of the 7th and had a private meeting with Governor Lee. It was his first visit since taking office on the 21st of last month.
 The meeting between the Deputy Prime Minister for Economic Affairs and the Governor of the Central Bank is significant as it represents a meeting between the control tower of domestic economic policy and the head of monetary policy.
 Former Deputy Prime Minister Choi Sang-mok also visited the Bank of Korea in February last year, about two months after taking office, to discuss plans for structural reform of the Korean economy with Governor Lee.
 Before the meeting, Deputy Prime Minister Gu met with reporters and said, "Personally, he is a senior and a respected governor who always provides various ideas for the Korean economy."
 Governor Lee said, "From Korea's perspective, the negotiations went well, greatly easing the burden of the August monetary policy direction meeting," adding, "I thought we would be in a difficult situation if the customs negotiations went wrong before the meeting."
He further stated, "You have achieved important results in difficult times. It's not over yet, so I hope you will continue to do well."
 Deputy Prime Minister Gu and Governor Lee also emphasized the need for structural reform.
 Deputy Prime Minister Gu said, "The reason for the decline in long-term growth rates is simply because our economy lacks capability," adding, "To enhance capability, all economic players must collaborate." He further explained, "If the Ministry of Strategy and Finance finds items to focus on and nurtures innovative items, labor productivity will increase, investment will grow, and technology will improve," adding, "With a sense of urgency that we must do it, I will consult well with the Governor of the Bank of Korea."
 Governor Lee also responded, "The Bank of Korea will cooperate as a think tank to the fullest extent in leading and restructuring the country's economy."
 During the meeting, Deputy Prime Minister Gu and Governor Lee reportedly discussed the domestic and international economic conditions and future policy cooperation plans extensively.
 The two leaders agreed that while our economy's potential growth rate is rapidly declining, the actual economy is not reaching the potential level, and that we are facing significant challenges both domestically and internationally, such as the complete change in the global trade environment due to U.S. trade policy.
 Deputy Prime Minister Gu also explained the new government's economic growth strategies, such as the AI transformation and super-innovation economy, and requested in-depth analysis and policy recommendations from the Bank of Korea.
 Governor Lee also evaluated that it is important to prepare specific implementation plans for structural reform to expand growth potential, and pledged to actively contribute to establishing such plans by utilizing the Bank of Korea's research capabilities.
 Moreover, both sides agreed on the importance of stable macroeconomic management through the harmonious operation of macroeconomic policies and decided to seek the optimal policy mix through close communication.
 After the meeting, Deputy Prime Minister Gu commented on the regularization of the Economic and Financial Issues Meeting (F4 Meeting), which involves the Deputy Prime Minister, the Governor of the Bank of Korea, the Chairman of the Financial Services Commission, and the Governor of the Financial Supervisory Service, saying, "It is uncertain whether it will be F4 or F3 due to organizational restructuring," adding, "Communication and becoming a one-team are important, so we will operate it well from that perspective."
 In response to a question about the possibility of achieving 1% GDP growth this year, he answered, "The goal is to raise the growth rate by doing our best."
 
 

eastcold@fnnews.com Kim Dong-chan Reporter