2024-04-18 23:15:36
Adoption of the first joint declaration by the finance ministers of the three countries
The U.S. joins the market intervention message, which is unusual.
“Important progress in financial-foreign exchange market cooperation”
Amid the strong dollar trend in the global financial market, the finance ministers of Korea, the United States, and Japan have expressed concern over the rapid decline in the value of the won and yen. The finance ministers of the three countries, who adopted the joint declaration for the first time, pointed out China’s overproduction problem and put up a joint front in putting pressure on China.
Deputy Prime Minister and Minister of Strategy and Finance Choi Sang-mok, U.S. Treasury Secretary Janet Yellen, and Japanese Finance Minister Shunichi Suzuki held a meeting in Washington, D.C. on the 17th (local time) and adopted a joint declaration containing these contents for the first time. They said, “We will closely consult on developments in the foreign exchange market in accordance with the existing commitments of the 20 major countries (G20),” and added, “We are aware of serious concerns from Japan and Korea about the recent rapid devaluation of the yen and won.” He said.
The meeting was held as a follow-up to the Korea-U.S.-Japan summit held at Camp David in the U.S. in August last year. While discussing the recent economic and financial situation, the issue of rapid exchange rate fluctuations was officially mentioned. Amid the strong dollar trend, the won-dollar exchange rate rose to 1,400 won during intraday trading on the 16th.
Inside and outside the government, it is considered unusual in that the United States, which is reluctant to intervene in market price decisions such as exchange rates, participated in this message. It is known that Korea and Japan coordinated such language with the United States right before the meeting. Some analyzes suggest that the United States was also unhappy with the situation where excessively strong dollar flows were putting a burden on neighboring countries. A government official said, “It is an important development that a message of cooperation has been issued between the three countries in relation to the financial and foreign exchange markets.”
At this meeting, the issue of China’s overproduction, which the United States continues to raise, was also on the agenda. “We emphasize the importance of cooperation to overcome the damage that other countries’ non-market economic practices can have on our economies, including supply chain vulnerabilities, economic coercion and overproduction in key sectors,” the three countries’ finance ministers said.
Although China was not directly mentioned, there is an interpretation that it shows the will to strengthen trilateral cooperation targeting China. They took issue with the fact that China, which has a sluggish real estate and domestic economy, is pushing cheap domestically produced products overseas, threatening the industrial base of each country. In Korea, concerns are growing as the market share of Chinese e-commerce companies such as AliExpress has recently surged.
Meanwhile, Deputy Prime Minister Choi attended the 5th Ukraine Support Conference held in Washington on this day and announced that Korea plans to spend more than 300 million dollars to Ukraine this year, including 200 million dollars (about 270 billion won) in humanitarian aid.
Sejong = Reporter Kim Do-hyung [email protected]
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2024-04-18 23:15:36