International credit rating agency Moody's evaluated that Korea's fiscal situation is manageable.
Deputy Prime Minister and Minister of Economy and Finance Gyu Yoon-chul met with Moody's annual consultation team at the Seoul Government Complex on the afternoon of the 8th to discuss the economic situation of Korea and key policy directions.
At this meeting, Moody's noted, "The political turmoil that has persisted for over six months has concluded with the establishment of the new government," adding that "structural reforms and legislative tasks to enhance potential growth rate have become easier based on a friendly political environment."
Regarding Korea's fiscal condition, Moody's provided the assessment that "the fiscal costs and liability burdens are still manageable compared to major advanced countries."
The deputy prime minister stated regarding future fiscal management directions, "We will manage the finances with the goal of creating a virtuous cycle where high productivity investment supports growth and economic growth reduces the liability ratio again through bold fiscal input."
He added, "By providing concentrated support where needed and boldly restructuring unnecessary parts through performance-oriented financial management, we will ensure that finances play their essential role as a catalyst while securing sustainability for long-term demand response."
Additionally, both sides discussed changes in economic policy resulting from martial law and early presidential elections, the execution progress of the supplementary budget, the possibility of supplementary budget formulation, the increase in household debt, and the recently concluded tariff negotiations with the United States during this meeting.
Moody's upgraded Korea's national credit rating from Aa3 to Aa2 in December 2015, maintaining the same rating for the tenth year. Previously, in May of last year, Moody's also maintained Korea's national credit rating and outlook at the existing level (Aa2, stable).