On October 27, the Ministry of Finance and Economy (MOFE), jointly with the Korea Development Institute (KDI), hosted the 2026 G20 Global Financial Stability Conference at the Four Seasons Hotel Seoul.
The conference, attended by approximately 300 prominent figures from the domestic and international economic and financial communities, opened with remarks by Second Vice Minister of Finance and Economy Huh Chang and KDI President Kim Se Jik, followed by keynote addresses from Chief Economist of the Inter-American Development Bank (IDB) Laura Alfaro, and Professor at Princeton University Markus Brunnermeier. The conference featured presentations and discussions across three sessions: (1) Global Economic Resilience and Financial Stability; (2) Financial Stability Risks and Policy Challenges from AI Innovation; and (3) Financial Stability Risks and Policy Challenges from Supply Chain Fragmentation.
In his opening remarks, Second Vice Minister Huh noted that the spread of AI and the restructuring of global supply chains are emerging as new risk factors that could threaten financial market stability. In response, he outlined three policy directions: proactively managing AI-related financial risks, securing fiscal space to prepare for future shocks, and establishing a dual safety net that combines the global financial safety net with supply chain resilience. Finally, ahead of Korea’s G20 presidency in 2028, he reaffirmed the country’s commitment to actively contributing to global financial stability discussions as a member of the G20 Troika* beginning next year and translating cooperation among member countries into tangible outcomes.
* A cooperative framework comprising the previous, current, and incoming G20 presidencies, designed to support the smooth operation of the G20 by ensuring continuity in key agendas and facilitating policy coordination.
In his opening remarks, KDI President Kim pointed to growing uncertainty in financial markets and emphasized the need for countries to share experiences and jointly explore innovative policy ideas and avenues for international cooperation to address emerging risks. He added that KDI would continue to engage in active policy discussions with MOFE, international organizations, and domestic and overseas research institutions to support the development of policy agendas through which Korea could contribute to the G20.
In his keynote address, Professor Brunnermeier noted that the growing adoption of AI is transforming trading and decision-making practices in financial markets while potentially giving rise to market instability and new risks to the financial system. In particular, he highlighted risks such as heightened market volatility stemming from increased AI-driven trading and growing dependence on technology, emphasizing the need to adapt monetary and financial policies and strengthen financial system resilience.
In her keynote address, IDB Chief Economist Alfaro highlighted that global imbalances could pose risks by amplifying financial market volatility. She also stressed the need to take a comprehensive view of corporate ownership structures and international production networks when assessing global imbalances, given the effects of multinational enterprises’ ownership structures and global production activities on trade balances across countries.
During the first session, titled “Global Economic Resilience and Financial Stability,” participants agreed that while the global economy and financial markets have remained resilient amid uncertainty, vigilance is needed regarding potential financial market risks and elevated debt burdens. They pointed out in particular that leverage and liquidity risks could amplify financial market shocks, while high debt burdens in emerging and developing economies could constrain economic growth. Participants discussed policy measures including stronger risk management in the financial system, securing debt sustainability, and pursuing growth-friendly structural reforms.
The second session, titled “Financial Stability Risks and Policy Challenges from AI Innovation,” examined how productivity gains and financial service innovation driven by the spread of AI technology could affect economic growth and financial stability, as well as potential financial stability risks such as excessive expectations surrounding AI investment and cyber risks. Participants also discussed financial supervisory and regulatory measures to strengthen risk management frameworks and enhance financial system resilience in response to vulnerabilities arising from the increasing use of AI by financial institutions.
The third session, titled “Financial Stability Risks and Policy Challenges from Supply Chain Fragmentation,” explored the effects of geopolitical tensions and supply chain restructuring on commodity markets and the real economy. Participants also examined the impact of supply chain shocks on inflation, exchange rates, and government bond yields, and exchanged views on policy responses to economic and financial market uncertainty, including supply chain diversification, stronger capacity to respond to external shocks, and expanded international coordination.
Building on the discussions at the conference, MOFE plans to continue contributing to stronger G20-level policy coordination and international cooperation to strike a balance between AI innovation and financial stability and enhance the resilience of the global financial system.
Please refer to the attached files.
