South Korean President warns of financial crisis with US investment demands
South Korea's foreign currency reserves stood at US$416.29 billion at the end of August.
SEOUL - South Korean President Lee Jae-myung warned that his country could face a financial crisis comparable to the 1997 meltdown if it accepts US investment demands without implementing proper safeguards, Xinhua reported on Monday, citing Reuters.
"Without a currency swap, if we were to withdraw US$350 billion in the manner that the US is demanding and to invest this all in cash in the US, South Korea would face a situation as it had in the 1997 financial crisis," he said in an interview with Reuters on Friday.
In a verbal agreement in July, South Korea promised to invest US$350 billion in the United States in exchange for the US tariffs cut on South Korean goods.
South Korea's foreign currency reserves stood at US$416.29 billion at the end of August. Seoul has proposed a foreign exchange swap line with Washington.
As to the US immigration raid in a South Korean factory earlier this month, Lee said South Koreans were naturally angered by the "harsh" treatment of the workers, warning that it could make domestic companies wary of investing in the United States.
The US Immigration and Customs Enforcement (ICE) raided the construction site of an electric vehicle battery plant run by a joint venture between Hyundai Motor Group and LG Energy Solution on Sept. 4.
Arrested were 475 individuals, including 316 South Korean workers who had been held at the Folkston detention centre in Georgia.
"I do not believe this was intentional, and the US has apologised for this incident, and we have agreed to seek reasonable measures in this regard and we are working on them," Lee was quoted as saying. - BERNAMA-XINHUA
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