Finance Ministry Hosts Consultation Meetings with S&P


The Ministry of Economy and Finance of South Korea kicked off their annual consultation meetings with Standard & Poor’s Global Ratings (S&P) on Monday. Led by Kim Eng Tan, senior director of Asia-Pacific sovereign ratings at S&P, the delegation is visiting the country for three days to discuss the country’s credit valuation and economic circumstances.

The group paid a visit to Finance Minister Choo Kyung-ho on the first day and will be having a series of meetings with officials from the foreign and industry ministries, the Financial Service Commission, and the Bank of Korea.

During the meeting, Choo stated that South Korea will remain committed to strengthening its financial stability, which will also be the basis for the nation’s budget for the upcoming year. The government is also making efforts to pass fiscal rules through the National Assembly, which will limit the fiscal deficit to 3 percent of the gross domestic product (GDP). If the debt-to-GDP ratio is more than 60 percent, the government shall reduce the deficit to 2 percent or less.

The Yoon Suk Yeol administration has implemented a cost-cutting policy following years of expansive fiscal spending due to the COVID-19 pandemic. Inflation in the country has been well-managed, decreasing to the 2 percent range recently. The Korean economy is likely to recover gradually, as exports are likely to improve due to rising demand for semiconductors and the job market growth will likely increase private consumption.

The finance ministry is closely working with the Bank of Korea and other relevant authorities to handle external risks such as the United States’ monetary tightening, Choo added. S&P has maintained South Korea’s long-term sovereign credit rating at “AA”, the third-highest level on the company’s scale, with a stable outlook.

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