South Korea and the European Union have concurred on the need to work together to ease financial volatility that could impede the global economic recovery, the government said Tuesday.
  

The finance ministry said the understanding was reached at the fifth Korea-EU Economic Dialogue session in Sejong City on Monday, where the two sides touched on macroeconomic developments, structural reforms, issues related to the Group of Twenty and investment promotion.
  

"South Korea stressed the importance of structural reforms and investment in facilitating an economic recovery, and said handling volatility in the financial market is something that has to be tackled," the ministry said.
  

It said the EU agreed that the G-20 countries need to work together on easing volatility.
  

There have been sudden fluctuations in foreign exchange rates and greater uncertainties in the stock and bond markets around the world, dampening investor sentiment and consumer confidence. Such trends are feared to impact economic output and trade negatively.
  

At the meeting, South Korea also explained that while the country's growth forecast has dipped in the face of external uncertainties, there have been improvements in consumer spending with employment continuing to expand at a steady pace. The growth target has been downgraded to 3.1 percent for 2015, from 3.8 percent, although many in the private sector argued that even the revised figure may be hard to achieve this year.
  

The EU side said its fiscal, labor and credit markets are showing signs of improvements, creating tailwinds for a cyclical upswing, but that there has been a faster-than-expected rebound in the inflation rate.
  

The economic bloc, however, said that the downside risks to the growth outlook have become more acute in the face of a slowdown in growth in China and emerging markets, as well as the debt issue facing Greece.
  

The two sides, meanwhile, outlined additional measures to make critical changes to boost their respective competitiveness.
  

South Korea said it is in the process of making the country's labor market more flexible to reduce joblessness among young adults and gradually expanding its social security net.
  

The EU said it is focused on the banking and capital markets and the energy sector, according to the ministry. (Yonhap)