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S Korea stands among world's highest-level fiscal reserve holders: IMF

English.news.cn   2010-09-07 16:28:58 FeedbackPrintRSS

SEOUL, Sept. 7 (Xinhua) -- South Korea's fiscal reserve stood at the world's top tier thanks to its relatively low state debt, the International Monetary Fund (IMF) said in a report Tuesday.

According to the report by the Washington-based organization, South Korea's fiscal holding was proven to be adequate so as to inject liquidity into the market in case of financial emergencies.

Among 23 industrialized economies reviewed, South Korea was one of the five countries to maintain strong liquidity reserve capabilities, along with Australia, New Zealand, Denmark, and Norway, the organization said.

Moreover, of the five countries, only South Korea, Denmark and Norway were found to be fully capable of meeting any liquidity shortages, the organization added.

As of 2009, South Korea's state debt vis-a-vis its growth domestic product (GDP) posted 32.6 percent, the third lowest after Australia and New Zealand, according to the IMF.

The organization further predicted the ratio to continue to fall to 26.2 percent by 2015 if South Korea continues to keep up its fiscal policies.

In contrast, Japan, Greece, Italy and Portugal were found to stand without enough fiscal reserves against any contingencies due to their large debts.

The United States, Britain, Spain, Ireland and Iceland were also said to have limited capabilities in the face of a possible financial crisis with respect to their fiscal liquidity.

The report came a day after the IMF predicted S. Korea's 2010 per-capita GDP to exceed 20,000 U.S. dollars, likely to post 20, 566 U.S. dollars thanks to its strong recovery pace.

Special Report: Global Financial Crisis

Editor: Lin Zhi
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