(Reuters) – The proposed introduction of a bank levy and possible ways to control cross-border capital flows will top the agenda at this week’s G20 finance ministers meetings, host South Korea said on Tuesday.
South Korea
Finance Minister Yoon Jeung-hyun also told an unscheduled media briefing that the euro zone’s debt crisis was becoming a factor that would delay policy “exit strategies” in some countries.
“I expect the bank levy issue to be discussed as an important agenda,” he said, referring to the proposed move aimed at making banks pay for the future bailouts of financial institutions.
Finance ministers and central bank heads from the Group of 20 leading economies meet in Busan, South Korea, on Friday and Saturday to fine-tune their views on key global issues before their leaders hold a summit later in the month in Canada.
There is broad support for the proposal but some countries, which experienced no heavy cost of bailing out financial institutions, are opposed to it.
Yoon said drawing up some form of regulations to cushion the capital flows across countries would also likely be discussed at the meetings.
“The IMF’s position has also changed (toward introducing controls),” he said.
Regarding the domestic economy, Yoon said the government’s position was to maintain its existing economic policy because private sector recovery was not yet fully self-sustaining.
But he played down the slowing pace of annual growth in the statistics agency’s composite leading indicator in recent months, which many analysts took as underlining the moderating recovery of Asia’s fourth-largest economy.
(Reporting by Lee Shin-hyung, writing by Yoo Choonsik; Editing by Jacqueline Wong)