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Senior presidential secretary for economic affairs Park Byung-won on Thursday said the country¡¯s US$240 billion foreign reserves of are ¡°not for decoration¡± and will be used if necessary to defend the exchange rate.
Park made the remarks at a forum sponsored by the Hyundai Research Institute and the Korea Economic Daily. "The foreign exchange reserves are meant to be used if necessary,¡± he said. ¡°And the government will use them." The implication seems to be that the government will intervene in the market by using its foreign exchange reserves if the won continues to plummet and economic difficulties grow.
"There is a profound difference between the current economic difficulty and the IMF crisis¡± in the late 1990s, he said. ¡°At the time there was a 'fire station' able to provide bailout funds. But now that fire station ¡° -- the U.S. -- which is supposed to help us replenish foreign reserves and extinguish the flames is on fire. So we have to be more alert because there is no outside force we can turn to for help."
But Park said there will be no capital gains tax exemption for owners of unsold apartments in the regions, a measure some have suggested to help the property market out of the doldrums. "The government can't give benefits to real estate speculators," he said.
(englishnews@chosun.com )
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