SEOUL, KOREA --- The government held an emergency Crisis Management Meeting on December 19 to examine the situation of the economy and financial markets and discuss measures to be taken following the death of North Korean leader Kim Jong-il earlier in the day. The meeting was led by Minister of Strategy and Finance Bahk Jae-wan.
The news of Kim’s death at about 12 PM increased the volatility of the stock market and the exchange rate, while raising interest by domestic and overseas media organizations in the North Korea risk, Minister Bahk said.
He emphasized that the government will deal with the situation in a careful manner as uncertainty may grow in the short term with North Korea posing a big risk to South Korean society, including its economy.
He said citizens should not feel unease as the economy has recovered without serious shocks in a short period of time even though the risk related to North Korea has grown, as shown by many instances in the past.
The minister said President Lee Myung-bak held a Cabinet meeting and National Security Council meeting to discuss the steps needed to prepare for every possible development. He added that the government will closely watch the situation unfolding in North Korea and in domestic and overseas markets, and take measures in a calm manner.
As part of its steps, the government will establish an emergency countermeasure team, consisting of officials from related ministries, which will be led by Vice Minister of Strategy and Finance Shin Je-Yoon. The Ministry of Strategy and Finance will closely examine global economic trends and macroeconomic effects from the North Korea situation, and the Ministry of Knowledge Economy will examine the situation of the real economy such as imports and exports so the country can continue to secure raw materials. Also, price-related government offices such as the MOSF, the Ministry for Food, Agriculture, Forestry and Fisheries, and the Fair Trade Commission will examine trends of daily necessities and establish new distribution methods and stabilize the supply if needed.
During the meeting, Minister Bahk also requested the financial and foreign exchange authorities to monitor the situation in domestic and overseas markets without overreacting and to take preemptive measures.
In addition, the minister said the government will maintain a 24-hour emergency system for the time being, and requested citizens to maintain their everyday routines and not to overreact such as by hoarding daily necessities.
He also emphasized that the government will inform credit rating agencies that the economy remains Strong.
