S. Korea says it holds enough foreign reserves to cover external debt
11/12/2008 15:29
South Korea's foreign exchange reserves is sufficient to pay its external
debts and avoid a possible liquidity crunch, a senior economic policy maker said
today.
"Our US$200 billion foreign reserves consist mostly of assets that can
be easily recouped," Vice Finance Minister Kim Dong-soo said on a local radio
program.
"The global financial crunch caused the reserves to decline
recently, but the amount is still the world's sixth-largest and we think it is
enough to cope with external payment demand," he said, adding that the country's
foreign reserve is unlikely to fall significantly in the future due to an
additional currency swap line with the US and a surplus in the nation's current
account.
According to the Bank of Korea (BOK), the nation's foreign reserves
dropped for the eighth straight month in November amounting to US$200.51
billion.
The continuous foreign reserves decline raised concerns that the
funds are not enough to cope with emergent economic conditions.
Meanwhile,
the external debt of South Korea reached US$425.09 billion as of the end of
November, making the nation a net debtor for the first time in eight years, the
Yonhap news agency said.
Short-term debts, which mature within a year,
accounted for 45 percent of the total, it said.
Xinhua
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