Choi Sangmok on Rumors of Han Running for President: "Hope for Reduced Political Uncertainty"

Flexible Response Expected to National Assembly's Supplementary Budget Increase Request
Need to Consider Impact on Government Bond Market and Fiscal Sustainability
Downside Risks for Korean Economy... Support Needed for Vulnerable Groups
"Treasury Department Currently Reviewing Exchange Rate Issues"

Choi Sangmok, Deputy Prime Minister for Economic Affairs and Minister of Economy and Finance, commented on the potential impact on the Korean economy of Han Ducksoo, Acting President and Prime Minister, running in the presidential election, saying, "I hope that political uncertainty will decrease in terms of external credibility."

On the 25th (local time), at the International Monetary Fund (IMF) in Washington D.C., Choi made these remarks during a meeting with reporters accompanying the G20 Finance Ministers and Central Bank Governors Meeting. He indirectly expressed concern in response to a question about whether, if Han resigns and runs for president, Choi would once again serve as Acting President, and whether frequent changes in the acting presidency could increase political uncertainty.

When asked whether he had received any prior notice regarding Han's rumored candidacy, Choi replied, "No, I have not." Regarding his assessment of Han's potential candidacy, he said, "No comment," declining to elaborate.

Choi Sangmok, Deputy Prime Minister for Economic Affairs and Minister of Strategy and Finance, who visited the United States to attend the Korea-US 2+2 Trade Consultations, the G20 Finance Ministers Meeting, and the International Monetary and Financial Committee (IMFC), is speaking at a meeting with accompanying reporters on the 25th (local time) at the International Monetary Fund (IMF) in Washington D.C. Ministry of Strategy and Finance

Exchange Rate Discussions Under Review in the U.S.... Possibility of Supplementary Budget Increase Mentioned

Regarding the proposal during the 2+2 Trade Consultations on the 24th to hold separate discussions between the Ministry of Economy and Finance and the U.S. Department of the Treasury on the exchange rate, Choi explained, "As far as I know, the Treasury is currently reviewing what to discuss." He also answered "No" to a question about whether there were any additional unofficial requests from the U.S. apart from what had been announced by the government.

In the meeting, Choi also commented on the current economic situation, saying, "There are clearly downside risks to the extent that it is difficult to make accurate forecasts." This is due to a decline in growth potential, significant political uncertainty, temporary factors such as disasters, and additional uncertainty stemming from the impact of U.S. tariffs, all of which have contributed to considerable domestic and external turmoil. He explained, "We need to respond by dividing and addressing the areas where we can help vulnerable groups endure."

Regarding the calls led by the opposition for an increase in the 12.2 trillion won supplementary budget proposal submitted to the National Assembly, he stated, "If the projects meet the principles we originally outlined, I believe we should respond flexibly." This leaves open the possibility of an increase, especially as various economic indicators, such as the first quarter GDP growth rate, which fell by 0.2% from the previous quarter, are showing negative trends.

When asked if there are limits to increasing the size of the supplementary budget, he answered, "It depends on whether the projects are effective and consistent with the principles the government originally announced," and added, "We also need to consider the impact on the government bond market and the sustainability of public finances." He further explained, "Whether it is domestic demand or exports, we need to identify and include projects that can have an immediate effect on those facing difficulties (the vulnerable groups)."

On the 26th, after the meeting, Choi held the Macroeconomic and Financial Issues Meeting (F4 Meeting) via video conference in Washington D.C., stating, "We recognize the current economic situation as very serious. "If the supplementary budget discussions in the National Assembly are based on the fundamental principle of using the people's precious taxes most effectively and on the premise of prompt processing, we will respond flexibly."

Choi Sangmok, Deputy Prime Minister and Minister of Economy and Finance, and Lee Changyong, Governor of the Bank of Korea, are participating in the Macroeconomic and Financial Issues Meeting (F4 Meeting) via video conference on the 26th (local time) in Washington D.C., USA. Ministry of Economy and Finance

First Meeting with Chinese Finance Minister in the U.S.... Reflections on Term: 'Some Regrets'

During his visit to the U.S., Choi met with finance ministers from various countries and said he felt "Korea has definitely grown in scale." He explained, "Countries like the European Union, Germany, and Canada requested meetings to share information on what we are doing." He also said, "Previously, only vice ministers from China attended, but this time, the finance minister came, and we met for the first time," adding that they discussed cooperation with the Asian Infrastructure Investment Bank (AIIB).

In the process of pursuing sustainable public finances, Choi also expressed the view that expanding the tax base is more necessary than increasing tax revenue. He said, "I don't think there is much room to raise the tax burden ratio," and pointed out, "To do so, there must also be public consensus." He continued, "Ultimately, the only way is to expand the tax base," and added, "I don't believe this is something to be achieved by increasing fiscal spending."

As his ministerial term draws to a close, Choi reflected, "It was very meaningful to serve as minister for a year and a half together with my juniors." He noted, "While I was in office, 66 officials were promoted from deputy director and director positions," and "Although this is a significant number, I felt that more should have been promoted." He acknowledged that while efforts were made to establish training and work systems to enhance the expertise of Ministry of Economy and Finance staff and to promote work-life balance, some goals remained unfulfilled, which he regretted.

Choi said, "Upon taking office, I spoke about a dynamic economy and presented three tasks: innovation, fairness, and social mobility." He continued, "In particular, regarding innovation and social mobility, I hoped we could do more to identify tasks such as expanding the growth ladder for companies and increasing the economically active population, but it is personally regrettable that we were only able to start and not finish these initiatives."