South Korea and Japan deepen financial ties amid AI, supply-chain focus

Koo Yun-cheol, Korea’s deputy prime minister and finance minister, traveled to Tokyo for the 10th Korea-Japan Finance Ministers’ Meeting. He met Japanese Finance Minister Katayama Satsuki at the Japanese Finance Ministry to exchange views on global and regional economic conditions and to discuss ways to deepen bilateral and multilateral cooperation.

Both ministers assessed that the world economy remains on solid growth, but face enduring risks from geopolitical tensions and other stress factors. They said the latest Middle East developments and volatility in financial markets warrant close cooperation to ensure stable energy supplies.

They also highlighted potential investment in artificial intelligence as a driver of economic growth, signaling a shared interest in leveraging technology to boost competitiveness.

The discussion touched on currency stability, with both sides noting concern over the sharp declines in the won and the yen. They agreed to monitor foreign exchange markets closely and to take appropriate steps to prevent excessive volatility and disorderly movements.

The ministers also focused on supply-chain resilience, including diversification of critical mineral supplies, and pledged closer cooperation on supply-chain policy. They supported efforts within ASEAN+3 to strengthen the Chiang Mai Initiative Multilateralisation, Korea and Japan’s regional financial safety-net framework.

They reaffirmed their commitment to working in multilateral forums such as the G20 and G7, noting Korea’s ongoing engagement since being invited to G7 finance ministers and central bank governors meetings for three consecutive years starting in 2023 by Japan. They also announced plans for a Korea-Japan Customs Chiefs Meeting in April to bolster customs cooperation and welcomed Korea’s step toward joining the World Government Bond Index.

The two sides emphasized continued bilateral financial cooperation, including currency-swap arrangements, and pledged ongoing cooperation on policy research and staff exchanges. This meeting was the first Korea-Japan finance ministers’ gathering since President Lee Jae-myung took office, and they planned to host the 11th meeting in Korea within a year.

For U.S. readers, the talks signal closer financial and energy-security coordination between two major Asia-Pacific economies, with potential implications for regional markets, supply chains for advanced technologies, and global investment flows. The discussions on AI investment, mineral supply diversification, and their stance on currency stability also bear on broader economic and security considerations affecting the United States and its allies.