Korea's foreign exchange reserves can repay foreign debt
Deputy Minister of Finance for International Affairs Shin Je-yoon made the remarks when he talked about the details and nature of Korea's foreign debt at a press briefing held at the Government Complex in Gwacheon, Gyeonggi Province that day.
According to the Deputy Finance Minister, the Korean government, banks and businesses owed foreign lenders a total of $419.8 billion as of the end of June -- the government ($63.1 billion), commercial banks ($127.4 billion), Korea Exchange Bank branches ($83.1 billion), non-banking financial institutions ($28 billion) and enterprises ($118.2 billion).
The Deputy Minister said, "We don't need to repay at least $151.8 billion of the entire foreign debt, given that this portion is based on forward exchange transactions. We're currently in a financial situation quite different from that during the financial crisis [of the late 1990s].”
Even in the worst-case scenario, the government can help commercial banks cover export-import credit loans amounting to $50 billion, which it can support with its foreign exchange reserves, he added.
He added that the government never feels relieved, though, and has decided to give support to banks so as to help them minimize the impact of the foreign debt burden.
In an effort to quell the rumors that the government holds a mere $20 billion in usable foreign exchange reserves, he said that all of the government's foreign exchange reserves of $240 billion are usable, and most of this amount can be turned into cash within a day or a week.
Turning to President Lee Myung-bak's Oct. 3 instructions to the Cabinet to push for the convening of a finance ministers' meeting among Korea, China and Japan, the Deputy Finance Minister said, "Times demand that the three countries develop active cooperation, considering that the latest U.S. financial instability could lead to worldwide economic slowdown.” He went on to say, “I understand that the presidential instructions were aimed at seeking cooperation among the three Asian nations to deal with a possible financial crisis in Asia on their own initiative."
He added, "If necessary, we are considering holding bilateral finance ministers' meetings separately with China and Japan. If an emergency should arise, we will seek joint ways to cope with it, even through conference calls."
A top agenda item would be to speed up the establishment of a joint Asian fund worth $80 billion, as was agreed by the finance ministers of the three countries and by those of ASEAN nations in May, he also said.
Meanwhile, Finance Minister Kang Man-soo and Financial Services Commission Chairman Jun Kwang-woo will meet with presidents of banks in downtown Seoul on the morning of Oct. 6 to discuss ways to supply the government's foreign exchange liquidity to the banks and support small- and medium-sized enterprises.
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2008년 8월 6일 17:21
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2008년 7월 4일 16:14