Washington: U.S. Treasury Secretary Scott Bessent announced that discussions between South Korea and the United States regarding the implementation of Seoul's US$350 billion investment pledge are expected to yield results within the next 10 days.
According to Yonhap News Agency, Bessent addressed questions during a press meeting about the potential resolution of differences over Korea's investment package, which was part of a bilateral trade agreement established in July. He expressed confidence in resolving the issues currently under discussion.
In response to inquiries about the possibility of a currency swap arrangement with South Korea, Bessent clarified that such matters fall under the jurisdiction of the Federal Reserve, not the Treasury Department. He referenced the existing currency swap facility between the U.S. and Singapore to illustrate his point, though he did not provide further details.
Seoul has expressed concerns about its significant direct cash investment potentially leading to financial instability, reminiscent of the Asian financial crisis of the late 1990s. Consequently, South Korea is seeking financial safeguards, including a currency swap arrangement, and prefers that the investment primarily comprises credit guarantees and loans, with minimal direct equity investment.
During a CNBC forum, Bessent noted that both nations are close to finalizing trade negotiations, emphasizing the importance of addressing detailed aspects of the agreement. Meanwhile, South Korea's Finance Minister Koo Yun-cheol indicated that the trade discussions are progressing swiftly.
High-level meetings between South Korean and U.S. officials are anticipated to expedite negotiations. Koo is expected to engage with Bessent during upcoming international finance events in Washington, while other South Korean officials will hold discussions with U.S. counterparts, including Commerce Secretary Howard Lutnick and Trade Minister Jamieson Greer.