Newsnomivcs AJAY ANGELINA reporter |
South Korea and Japan restores currency swap worth US$10 billion and agreed to expand cooperation in areas such as revitalizing mutual financial investment, regional financial safety net, and international taxation that has been suspended since 2015 due to historical disputes between the two nations.
Choo Kyung-ho, South Korea’s minister of economy and finance, and Shunichi Suzuki, finance minister of Japan announced the agreement of currency swap worth 10 billion dollars following their meeting in Tokyo on Thursday June 30,2023.
Going forward, South Korea will be able to swap US$10 billion worth of South Korean won for US$10 billion held by Japan.
The resumption of the Korea-Japan currency swap can be seen as a symbolic measure as well as the recovery of bilateral relations between the two countries.
Suzuki Finance minister of Japan said, “we held frank and significant talks over various issues regarding the finance track upon resumption of the bilateral dialogue.”
"I strongly hope the talks of this time leads to further improvement in the bilateral relationship.” He added Choo, South Korea’s minister of economy and finance said, “The Korea-Japan currency swap establishes a framework for solidarity and cooperation in the field of foreign exchange and finance with countries that share universal values such as Korea, the US and Japan.”
“This means that the foreign currency liquidity safety net among advanced countries with free market economies will be extended to our financial and foreign exchange markets. “Choo added.
Later, South Korea's presidential office highlighted the deal between the two countries that marks the improvement of bilateral relations and is expected to have positive effects on financial and foreign exchange markets.
With this latest agreement reached between Seoul and Tokyo, watchers expect this to be a starting point for economic cooperation to flourish between not only South Korea and Japan, but also with the United States.
South Korea and Japan’s first currency swap deal worth US$2 billion was stuck in 2001. The dollar value increased to US$30 billion during 2008 financial crisis and US$70 billion during 2011 European financial crisis.
