Proceedings of Economic Review Meeting
□ Bank of Korea Governor Kim Choongsoo held an Economic Review meeting with the heads of major institutions and scholars from 7:30 a.m. to 9:40 a.m. on March 23
(Wed)at the Small Conference Room of the Bank of Korea.
ㅇ Participants :
Kim Joohyung, President of LG Economic Research Institute Kim Taejoon, President of Korea Institute of Finance
Park Sangkyu, Executive Vice President of Construction Association of Korea
Park Wonam, Professor of Hongik Univ.
Oh Kanghyun Chairman of Korea Petroleum Association Lee Jaymin, Professor of Yonsei Univ.
(Appendix)
Major Points Discussed
□ Governor Kim Choongsoo engaged in a wide-ranging exchange of views with leading figures from economic research institutes and academia concerning current economic trends and principal concerns.
□ Participants shared the view that the Korean economy would keep up a consistent pace of growth even though the degree of uncertainty regarding external conditions has greatly increased.
ㅇ The opinion was expressed that difficulties are mounting in the case of the construction industry, as overseas construction has contracted due to the political unrest in the MENA (Middle East and North Africa) region.
□ Those attending concurred with the view that the possibility of the upward pace of prices accelerating runs high, as rising international commodity prices combine with heightened demand-side pressures resulting from the economic upswing.
ㅇ It was pointed out that interpreting the recent rise in international oil prices as resulting solely from supply-side factors is inappropriate, given that it has been driven to a considerable extent by expanding demand from China and other emerging market countries.
ㅇ There was a feeling that future international oil prices will fluctuate by and large within a limited range around their current levels, provided that the MENA turmoil does not spread to engulf the core oil-producing countries.
□ The majority of those attending agreed with the view that it was important in the conduct of monetary policy to stabilize inflation expectations in order to cope with the upward price pressures.
□ It was also noted that, in keeping with the international trend, the central bank's role in any macro-prudential policy framework needs to be strengthened in Korea as well.
ㅇ In this context, it was advocated that such measures as the Macro-prudential Stability Levy on non-core foreign currency liabilities should be deliberated on in consultation with the OECD and other international organizations responsible for setting international norms and standards.
