The Korea Herald


S. Korean finance minister calls for continued reform of financial system

By 고영아

Published : Feb. 19, 2011 - 14:25

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PARIS -- South Korea's top economic policymaker on Friday urged financial and economic leaders of the world's major countries to continue efforts to stabilize the global financial system if they intend to strengthen the economy and tackle the issue of global imbalance.

"The financial system needs to maintain stability to strengthen the real economy and reduce global imbalance," Finance Minister Yoon Jeung-hyun said in a closing speech at a seminar held on the sidelines of a Group of 20 meeting among finance ministers and central bankers in Paris.

"Strengthening macro-prudential regulations in banking is crucial for today's international monetary system to reduce capital flow volatility," he added.

The seminar was organized jointly by the French government and the Eurofi, a European think tank comprising 33 financial companies in the eurozone. It was attended by G-20 representatives and heads of the world's major financial institutions, including the International Monetary Fund.

His remarks are in line with ongoing G-20 discussions on how to reduce volatility in the financial market as excessive capital flow has been blamed for market turbulence witnessed over the past years.

Referring to the efforts made in the process of getting over the latest financial crisis through the G-20, he also stressed the importance of such reform efforts in emerging countries.

"To date, the G-20 has mainly concentrated on the financial architecture reform in advanced countries. From now on, we would need to focus more on the financial system of emerging markets and consumer finance issues," he said.

Yoon added that financial regulatory reforms are also needed in order to stabilize commodity markets, citing derivative markets as an area that requires more restructuring efforts.

"In order to stabilize the commodity prices, it would be necessary to consider effective measures to regulate derivatives. These are the reasons why we should not cease our efforts on financial regulatory reform," he noted. (Yonhap News)