Kim says S. Korean financial crisis over<\/p>\n
SEOUL, South Korea (AP): President Kim Dae-jung said Friday
\nthat South Korea has fully overcome a foreign exchange crisis
\nthat hit in late 1997.<\/p>\n
It was the first time that Kim has boasted of a full victory
\nover the financial crisis. He previously had maintained a
\ncautious position on the issue.<\/p>\n
\"As I predicted, we have completely overcome the foreign
\nexchange crisis in one and a half years,\" Kim told a meeting with
\ncivic leaders in the southern provincial town of Changwon.<\/p>\n
Kim cited increased foreign exchange holdings, low interest
\nrates and low inflation as evidence for his conclusion.<\/p>\n
Kim took office two months after South Korea's economy was
\nbailed out by the International Monetary Fund in December 1997.
\nIn his inauguration speech, Kim said he will try to get South
\nKorea out of the crisis in 1 1\/2 years.<\/p>\n
Massive reforms linked to the IMF's record US$58 billion
\nbailout forced thousands of financially weak companies to
\ncollapse, resulting in mass layoffs.<\/p>\n
But South Korea's economy has since rebounded dramatically and
\nis expected to grow by more than 9 percent this year, compared
\nwith minus 5.8 percent last year.<\/p>\n
Kim said South Korea's foreign exchange reserves, which now
\nstand at $68 billion, will continue to grow, helped by brisk
\nexports and expanding current account surplus.<\/p>\n
The number of jobless has also dropped from 1.78 million at
\nthe start of this year to 1.07 now, he said.<\/p>\n
Kim also predicted that inflation will stabilize at the 1-
\npercent level.<\/p>\n
An IMF official said Friday that the IMF's current 6.5
\npercent growth forecast for South Korea this year is too low.<\/p>\n
Flemming Larsen, the IMF's deputy director of research, said
\nin a speech to business and government officials that he thought
\nthat South Korea's gross domestic product should grow closer to 9
\npercent.<\/p>\n
\"It's quite clear that our projection is too low,\" Larsen
\nsaid.<\/p>\n
The IMF made its projections for South Korea's economy two
\nmonths ago, citing low interest rates and inflation and President
\nKim Dae-jung's strong macroeconomic policies.<\/p>\n
Larsen said South Korea could now afford to adopt looser
\nfiscal and monetary policies to stimulate domestic demand and
\nspur economic growth, given its strong external surplus.<\/p>\n
South Korea's state-run think tank, Korea Development
\nInstitute, projected last month that GDP grew by 11.1 percent in
\nthe third quarter, a sharp rebound from the 7.1 percent
\ncontraction in the same period a year ago.<\/p>\n
While private economists see South Korea's economy growing by
\naround 9 percent in 1999, official IMF forecasts have erred on
\nthe conservative side.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/kim-says-s-korean-financial-crisis-over-1447893297",
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