South Korea Willing to Guarantee Foreign-Currency Borrowing

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South Korea's government has agreed to guarantee foreign-currency borrowing by the country's banks to help stabilise financial markets.

The finance ministry, the central bank and the financial services commission said about $100bn of borrowing would be covered by the package.

The government will also provide $30bn of liquidity to banks, and there will be more aid to small businesses.

South Korea's economy is the third largest in Asia and 13th in the world.

It enjoys major export success in a number of manufacturing industries, but especially shipbuilding, car-making, and electronics.

However, the country has appeared particularly vulnerable to the global credit crisis because its banks lacked sufficient dollars to service maturing foreign debt. - BBC News