” of the economy for as long as the economy does not pull itself out of recession, gradually turning into a time - bomb for the economy as a whole. for example, if the korean economy had not recovered this year, the restructuring of the daewoo group ( a large chaebol some of whose interlinked companies have been placed under a workout program ) and the problems involving investment trust companies - two major issues which have come to the fore since july - might have remained under the surface with the potential to cause even greater trouble in the future. this all leads to the conclusion that economic recovery is vital for the smooth implementation of restructuring measures. having said this, we must bear in mind that if the economy recovers too quickly and exuberantly, causing overheating, economic units may not feel the need to restructure themselves. too low interest rates choke off companies ’ incentives to reduce their debt. with the improved cash flow, companies are lured into expanding their business. also, financial institutions become less interested in clearing bad debt from their books since the opportunity cost of holding it decreases with lower interest rates. another problem can spring up in the choice of monetary policy stance when inflationary pressures begin to rise due to an over - accommodating policy. in most cases, the period of restructuring corresponds to a deflationary phase so that the central bank can ease monetary policy without worrying about inflation. however, if inflation raises its head before the restructuring has proceeded very far, the central bank may be in a position where it has to choose between price stabilization and maintaining an environment favorable to the restructuring process. this is a dilemma for the central bank because either choice will have negative effects. if the central bank, for example, adopts a monetary - tightening stance to fight inflation, then the short - term profitability of companies and financial institutions will deteriorate, which may blunt the momentum for restructuring. on the other hand, if a relaxed monetary policy stance is maintained to keep restructuring on the road, prices rise and companies may once again turn to their debt - dependent, expansionary management style, which ran riot in the past. as a result, people will come to lose faith in restructuring itself. for successful restructuring, therefore, the economy must not be allowed to overheat nor should the recovery be less than adequate. achieving a well - balanced, unbiased economic environment for sustainable growth creates the best condition for reform measures. in other words, the central bank

chang yong rhee : welcoming remarks - international conference on green finance welcoming remarks by mr chang yong rhee, governor of the bank of korea, at the opening ceremony of the international conference on green finance, co - hosted by the 2050 presidential commission on carbon neutrality and green growth and the bank of korea, seoul, 20 june 2023. * * * good morning, ladies and gentlemen. i am chang yong rhee, governor of the bank of korea. i wholeheartedly welcome all the attendees here at this conference jointly organized by the 2050 presidential commission on carbon neutrality green growth committee and the bank of korea. i would like to express my sincere gratitude to cochairman sang - hyup kim, who passionately serves as a " green man, " to mr. daeyoung kwon, standing commissioner of the financial services commission, for his keynote speech on " strategies to pursue korean - style green finance, " and to ms. benedicte nolens, head of the bis innovation hub hong kong centre, for accepting our invitation to give a presentation. i would also like to welcome all the government officials, bankers, and corporate representatives who will be presenting and discussing in the sessions, and all those who are attending this event. last, but not least, i would like to express my deep gratitude to imf managing director kristalina georgieva for sending a very special congratulatory video. today, it holds special significance for the bank of korea that we are hosting this conference with the carbon neutrality green growth committee. as we celebrate our 73rd anniversary, it is a fresh experience for the bank of korea to move into a new building and to hold our first conference with a government agency. furthermore, the climate change response, the theme of today's conference, is a global issue that demands individual roles and collective efforts from us all. in my speech at the bank of korea's anniversary ceremony on june 12, i mentioned the need to prepare for changes in the economic structure, namely the new normal after the pandemic. it is a well - known fact that the climate change response is one of the key challenges to prepare for this new normal. i would like to explain the reasons for this with three points. first, the environmental challenges posed by climate change directly impact our quality of life. over the past 20 years, approximately 4 billion people worldwide have been affected by climate disasters, resulting in over 500, 000 deaths, and estimated economic