South Korea And Japan To Discuss Bilateral Currency Exchange Agreement

Finance Minister Shunichi Suzuki said on Friday that Japan and South Korea may debate this month what will happen to a bilateral currency exchange agreement that was supposed to end years ago. However, some officials expressed scepticism about such expectations.

The bilateral financial discussion between Suzuki and his South Korean counterpart Choo Kyung-ho will take place on June 29 thanks to the two Asian neighbours.

The Japan-South Korea currency exchange agreement, which had been a representation of the two countries' financial cooperation and had functioned as a safety net in case of a currency crisis, ended in February 2015 amid deteriorating relations.

The heads of finance for the respective nations will talk about infrastructure investment abroad, coordination at the G7 and G20, regional and bilateral financial cooperation, as well as bilateral collaboration in taxation and customs.

According to Suzuki, it might involve a swap agreement between Japan and South Korea. That is all I can disclose at this time because we are finalising our plans for June 29.

the Chiang Mai Initiative, an international currency swap plan for the region The importance of multilateralization and other bilateral swap agreements as financial safety nets will probably also be discussed.

A representative of the Japanese administration had previously stated that they were unsure of how the bilateral currency swap negotiations would progress.

"Japan might be being cautious out of worry that the exchange agreement might become mired in diplomatic disputes once more. Nevertheless, considering the role it plays in preserving markets during a crisis, they could both come to an agreement, according to Toru Nishihama, an emerging market economist at the Dai-ichi Life Research Institute.

The two nations' efforts to restore frayed ties in order to address North Korea's missile threat and geopolitical issues in the Asian area will include the financial dialogue.

It will signal the resumption of the regular communication between the finance ministers of the two nations, which they committed to do at their meeting in early May after it had been put on hold in 2016.