Jeon Vows to Keep Rising Won in Check

Deputy Prime Minister and Minister of Finance Economy Jeon Yun-cheol said on June 8 that the government will take due measures to help businesses cope with the won`s recent rally against the U.S. dollar. According to the top financial policymaker, an insurance program will be offered to businesses so that they can reduce exposure to exchange rate fluctuations.

In regard to the controversial 5 working day system, Jeon promised an aid package for small and medium firms, which includes workforce reinforcement, funding and tax benefits.

"The won is rising too fast against the greenback, compared with other Asian currencies," noted the finance minister during a radio discussion with KBS. "We are ready to step in the market to keep the won under a certain level." He said that the government would assist exporters in avoiding exchange rate risks by allowing them to subscribe to insurance provided by the Korea Export Insurance Corp.

"We are hammering out ways to help small and medium businesses with workforce, funding and taxation to ease the burden of the 5 working day system," he added.

When asked whether he is considering lowering taxes as required by local election candidates and interest groups, he replied that the government must "seek impartiality in lowering taxes as it is like providing financial support," adding "It is not likely."

Joong-Hyun Park sanjuck@donga.com