South Korea's government attended the G20 finance deputies meeting in Washington, D.C., pointing to structural factors rather than exchange rates or demand shortfalls as the root causes of global imbalances. The move represents a defensive stance against pressure targeting current account surplus countries, arguing that fundamentals such as aging demographics and industrial structure should be considered.
The Ministry of Economy and Finance (MOEF) announced Thursday that Choi Ji-young, Deputy Minister for International Finance, attended the "First 2026 G20 Finance Deputies and Central Bank Deputies Meeting" held in Washington, D.C. on January 15-16. This was the first meeting chaired by the United States as the 2026 G20 presidency, with economic growth, deregulation and energy among the key agenda items.
The session on "global imbalances" drew the most attention. The United States, as chair, raised the need to reduce global imbalances and brought up the issue of adjustment between current account surplus and deficit countries.
In response, the Korean government drew a clear line, stating that "the fundamental causes of global imbalances are not simply a matter of exchange rates or weak domestic demand." MOEF suggested that in-depth analysis is needed on how structural differences among countries—including aging populations, changes in industrial structure, and savings-investment gaps—affect current account balances. This clarified Korea's position that an approach considering each country's economic fundamentals is necessary, rather than simple exchange rate adjustments or artificial pressure to boost domestic demand.
On digital finance issues including virtual assets, Korea emphasized regulatory consistency. The government said that "gaps in digital asset regulation and supervisory frameworks between countries must be narrowed," requesting in-depth analysis at the G20 and Financial Stability Board level. Korea particularly argued that core requirements for stablecoins—including issuance, reserves and redemption—should have internationally consistent standards.
Regarding the global economic outlook, most member countries saw a high possibility of a soft landing as inflation eases. However, geopolitical fragmentation and trade tensions were cited as downside risks. Korea proposed supply-side structural reforms in labor and education as solutions to raise growth potential. It also explained the importance of sound fiscal policy, including efforts to comply with fiscal rules to ensure fiscal sustainability.
At the meeting, member countries expressed support for the financial sector regulatory modernization agenda proposed by the United States, while reaching consensus that it should be pursued in a balanced manner that does not undermine financial stability. A MOEF official said, "As the United States has declared its intent to streamline the finance track and focus on core agendas as chair, we will respond to ensure Korea's position is reflected in a direction consistent with our national interests in future discussions."
