S. Korea rejects WSJ report on IMF bailout plan

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SEOUL, Oct. 24 (Yonhap) -- South Korea on Friday dismissed as "groundless" a Wall
Street Journal (WSJ) report that the International Monetary Fund (IMF) may
include the nation in its new bailout program.
In an article on its Web site, the WSJ reported Thursday that the IMF is putting
"final touches" on a plan to help developing nations get over the global
financial crisis by providing loans that "don't require borrowers to make
far-reaching policy changes."
South Korea, Mexico, Brazil and Eastern European nations might be among the
countries which will receive benefits from the newly-devised short-term liquidity
swap program, the report said.
"It (Korea's inclusion) is totally groundless," said Choi Jong-ku, head of the
Finance Ministry's international financial bureau. "It is true that the IMF is
considering such a scheme but South Korea has no reason to be included in the
program."
Choi said the IMF is fully aware of how much South Korea has in foreign reserves,
which total US$240 billion, and that the organization has said many times that
South Korea's external position remains in sound shape.
The WSJ report comes as fears are spreading fast that the U.S.-sparked global
financial turmoil could take a heavy toll on many countries, with some crying for
help from the international lender.
South Korea's government is also grappling to stabilize its financial sector by
unveiling a raft of measures aimed at stabilizing its financial industry,
including a $130 billion bailout package announced on Sunday.
South Korea has bad memories of the IMF stemming from an IMF-arranged bailout
package it received in 1997 during the Asia-wide financial crisis.
To meet demand for a wide range of reforms attached to the rescue loan, South
Korea quickly cleaned up its financial sector and in 2001 withdrew from the
fund's bailout program by paying back the loans.
kokobj@yna.co.kr
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