S. Korea pledges sufficient forex liquidity for virus-hit exporters, importers

Yonhap via The Korea Herald/Asia News Network

SEOUL — South Korea‘s finance ministry said Tuesday it will continue to supply sufficient foreign-exchange liquidity to exporters and importers hit by the coronavirus pandemic.

Vice Finance Minister Kim Yong-beom made the remarks at a meeting with senior executives from major exporters and importers earlier in the day, the ministry said in a statement.

Kim told the meeting that the global economy is expected to take a big hit by “unprecedented large-scale shocks” from the pandemic, which disrupted global supply chains and ravaged consumer demand.

“Negative impacts on our exports are expected to be more visible ahead due to a shock in global supply chains and demand,” Kim said.

The government is fully prepared to help exporters and importers with contingency measures, including a supply of foreign-exchange liquidity and financial support, Kim said.

In a bid to supply more dollars into local markets, the government eased foreign-exchange liquidity rules last month.

The liquidity coverage ratio (LCR) for banks was relaxed to 70 percent from 80 percent for three months.

Earlier in the day, customs data showed South Korea’s exports sank 26.9 percent on-year in the first 20 days of April to $21.7 billion.

The data came amid growing concerns that the coronavirus pandemic is denting the exports of Asia‘s fourth-largest economy.

The new coronavirus has disrupted trade and halted production around the globe, with a rising number of countries fully closing their borders. Yonhap