Lee Chang-yong "Regional Imbalance Mitigation Can No Longer Be Delayed"

Welcome Address for the 2024 BOK Regional Economy Symposium

[Image source=Yonhap News]

Lee Chang-yong, Governor of the Bank of Korea, stated that "mitigating excessive regional disparities is an urgent task that can no longer be postponed for the stability and sustainable growth of the national economy."

Governor Lee attended the '2024 BOK Regional Economy Symposium' held at Signiel Busan on the 19th and said, "Recently, the widening gap between sectors due to changes in industrial structure and technology has manifested as regional disparities between the Seoul metropolitan area and other regions, weakening the growth foundation of regional economies."

He added, "In the past phase of population growth, regional balanced development policies clearly contributed to expanding the growth base and improving the quality of life in underdeveloped areas. However, now that our economy has entered an unavoidable path of population decline, it has become more important than before to carefully evaluate the effectiveness of investments. For efficient balanced development, a strategy of selection and concentration is essential."

He expressed concern, saying, "As with most structural reforms, when regional interests are intertwined, there is a possibility that short-term solutions acceptable to the majority will be chosen rather than pursuing long-term benefits."

He also emphasized solving structural problems. Governor Lee said, "To effectively conduct monetary policy, it is essential to have a deep understanding of the structural issues that have accumulated as much as the achievements our economy has made in a short time. Structural problems such as low birth rates, aging, and regional disparities have negative impacts on the economy and society, and these effects are first realized in local communities, which are the living grounds of our people."

At the end of his welcoming remarks, he explained the current situation by comparing it to a tree. Governor Lee said, "If we have only one tree left and everyone tries to climb that tree, gradually, only those who climb higher can pick the fruit, and the competition to reach the high-hanging fruit will exhaust everyone. On the other hand, if we try to grow too many trees, resources and efforts will be dispersed, ultimately causing most of the fruit to become poor."

He emphasized, "Rather, the direction we should take going forward is to cultivate a few strong trees that can bear good fruit together."