S. Korea to lead world in foreign reserve growth this year: IMF

SEOUL, Nov. 4 (Yonhap) -- South Korea is expected to lead the world in foreign reserve growth this year thanks mainly to its huge trade surplus, the government said Wednesday, citing an International Monetary Fund (IMF) report.

The Ministry for Strategy and Finance said the Washington-based organization
estimated the country's foreign currency stockpile grew by US$43.7 billion in the
first eight months of this year, adding that gains may reach around $70 billion
by the end of 2009.
In January, the country controlled a little over $201.7 billion worth of foreign
reserves.
"The sharp increase is mainly due to the country's huge trade surplus and drawing
in of foreign currency-based liquidities in the market," a ministry official
said.
In the first 10 months of this year, the country's trade surplus topped a record
$34.6 billion.
He said the gains marked the highest increase tallied among the organization's 62
key members, with South Korea's total reserve size likely to hit $270 billion
this year.
The expert added that since the IMF recently recommended that Asian economies try
to acquire more foreign reserves to guard against future economic crises, the
increase posted by the country should be beneficial to the national economy.
Besides South Korea, the latest findings showed Hong Kong's reserves growing by
$41.5 billion from January through August, followed by Switzerland, Denmark and
Japan.
Switzerland's reserves went up $33.9 billion, with Denmark's holdings gaining
$33.5 billion.
The IMF report excluded China -- the world's largest foreign reserve holder --
from its report, but said Japan's stockpile gained $31.3 billion in the cited
period. Japan's total foreign reserves stood at $1.42 trillion as of August.
However, it said that countries like Argentina and Norway witnessed the size of
their foreign currency holdings decrease this year.
yonngong@yna.co.kr
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