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(LEAD) S. Korea's economy capable of responding to crises: regulator

All News 14:37 April 19, 2017

(ATTN: ADDS details, U.S. official's remarks in last 4 paras)

SEOUL, April 19 (Yonhap) -- South Korea's economic fundamentals are sound and it is capable of "fully" responding to potential crises at home and abroad, the nation's top financial regulator said Wednesday.

Zhin Woong-seob, governor of the Financial Supervisory Service (FSS), said, however, global uncertainties, including U.S. interest rate hikes and a wave of protectionism, make it "increasingly difficult to predict the future we're headed towards."

"Looking outward, we can also see the global environment full of uncertainties, as depicted by the prevalence of trade protectionism, an interest rate hike by the Fed and possible breakup of the EU," Zhin told a meeting of senior executives at foreign financial firms in South Korea.

Zhin said global uncertainties are unlikely to have a negative impact on the South Korean economy.

"The Korean economy has strong fundamentals, has the eighth-largest foreign reserves in the world and recorded a current account surplus for 60 straight months," the FSS chief.

"Moreover, the financial sector is fully capable of responding to crises, as capital soundness and foreign currency liquidity at local banks have been maintained at favorable levels," Zhin said.

Zhin said South Korea is continuing its efforts to create a fairer business environment for foreign investors.

"We strive to create a business-friendly environment for foreign financial companies and further develop the Korean financial market," Zhin said.

Marc Knapper, the acting U.S. Ambassador to South Korea, told the forum that the U.S. government has encouraged South Korea to "follow global standards and consider the effect of regulations on international trade and competition."

The U.S. government is asking South Korea to establish a "regulatory reform bureau" under the Financial Services Commission, which directs the FSS, to create a "better business environment," Knapper said.


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