Korea urges G20 for more currency swap deals

South Korea’s top fiscal chief proposed more currency swap deals at a key G-20 meeting to help tackle the impending global economic recession, the Ministry of Economy and Finance said Wednesday.

Deputy Prime Minister and Finance Minister Hong Nam-ki’s remarks were made during a virtual meeting of the G-20 finance ministers and central bank governors on Tuesday.

According to the ministry, Hong also stressed the need for reforms of the International Monetary Fund framework to strengthen its crisis response.

“IMF reforms to bolster its capacity is an imminent task necessary for strengthening the safety net for global finance,” Hong told the economic leaders.

“Allocation of special drawing rights, which was carried out during the 2008 financial crisis, should be actively considered.”

An increasing number of global economies in recent weeks have been asking the IMF for emergency financing to cope with repercussions of the latest pandemic.

In 2008, the IMF tripled its lending capacity to $750 billion and allocated over $270 billion in the form of special drawing rights, which works as a supplement to the existing official reserves of member countries.

IMF Managing Director Kristalina Georgieva said the governing body, International Monetary and Financial Committee, has endorsed initiatives to “enhance access to (the organization’s) emergency facilities and “help countries experiencing foreign exchange shortages,” the IMF said in a press release.

The economic leaders agreed to swiftly materialize the G-20 Action Plan to address the pandemic, the ministry said. The members have reportedly agreed to put forth an action plan in two weeks to deal with the outbreak.

Hong said that Korea is sharing its countermeasures on COVID-19 quarantine measures with international organizations. It plans to share the information with G-20 members as well.

By Jung Min-kyung (mkjung@heraldcorp.com)