activate housing finance using reits ( asset investment - based korean style new reits ), bank of korea ( in korean ). lee, e., chun, d., kim, j. & lee, d. ( 2024 ), " potential growth rate and future outlook of the korean economy ", bok issue note no. 2024 - 33 ( in korean ). 1 korea's household debt - to - gdp ratio stood at 91. 1 % in the second quarter of 2024, ranking 5th out of 44 countries for which the bis compiles data. 2 based on the imf's october 2024 economic outlook 3 the proportion of the self - employed was calculated using the oecd's criteria for international comparison, which includes unpaid family workers who can be considered de facto self - employed. 4 the structural reform report released by the bank of korea last year references various studies, including : low birth rates and aging populations ( chae et al., 2024 ), balanced regional development and college entrance systems ( chung et al., 2024a ; chung et al., 2024b ), household debt ( kim & na, 2024 ), and challenges including climate change and global supply chains ( kim et al., 2024 ; jung et al., 2024 ; im et al., 2024 ). 7 / 7 bis - central bankers'speeches

as they were significantly affected by political events, and, even though we were expecting rapid us monetary policy tightening and a strong dollar well in advance, the change in the dot plots in the september fomc meeting was more than we expected. on top of that, the fact that two major central banks in japan and china are the two exceptional cases of loose monetary policies made our currency depreciate much more than expected in september before it started to stabilize recently. 1 / 2 bis - central bankers'speeches more recently, prices and our exchange rate have somewhat stabilized and the speed of us interest rate hikes is expected to be less rapid as indicated by the recent press conference by chairman powell. ensuring price stability and reducing inflation through tight monetary policy are still our priority. at the same time, as the recent interest rate increase has been fast by any historical standard in korea, there are growing signs of stress in various sectors, and maintaining financial stability, especially in non - banking financial sectors, is becoming an important issue. in fact, we are seeing signs of money move from non - banking sectors to the banking sector after deposit rates in banks significantly increased following policy rate hikes. how to recycle those flows back to non - banking sectors is an important policy issue for the bok to manage financial market stability in this period of high inflation and tight monetary policy. now, back to long - term challenges facing the korean economy. among many challenges, the risk of economic and geopolitical fragmentation stands out to me the most. in fact, it is a short term challenge, too. the escalating us - china tensions and further deterioration of the russia - ukraine war are likey to lead to financial and trade fragmentation and consequently, the contraction of global growth and trade. it will be structural headwind limiting long run growth of the korean economy, which is heavily dependent on exports. in this respect, global cooperation at the economic and political levels is more urgently needed than ever. countries responsible for global leadership, among others, need to promote collaboration and cooperative competition, since the weakening of trade and global growth stemming from fragmentation can have negative impacts on all countries. in retrospect, china's rapid growth over the last two decades allowed the korean economy to delay painful restructuring, while reaping the benefits of trade expansion with china. we no longer have that luxury. korea cannot any more avoid restructuring reforms, even though painful, in diversifying its supply chains and concentration of key industries