Finance Minister Hong Nam-ki has proposed creating a joint investment fund with Russia to develop key industrial materials, components and equipment.

The finance chief made this proposal on Thursday while attending a session of the fifth Eastern Economic Forum under way in Vladivostok, Russia.

During the meeting with Korean and Russian business officials, the minister said the joint fund can help Russia commercialize its core technologies for overseas sales while allowing South Korea to diversify import channels of key materials, parts and equipment.

He also urged the creation of a new value chain and connecting broken or weak ones in order to facilitate the Eurasian economy, stressing the importance of cooperation and exchanges between Korea and Russia to achieve this goal.

To create new value chains, Hong also called for a free trade agreement with Russia in the service and investment sectors as well as free trade talks with the Eurasian Economic Union.

Seoul is pushing to localize or substitute industrial materials, parts and equipment to cope with restrictions imposed by Japan on exports to South Korea.