Koo Yun-cheol, Deputy Prime Minister and Minister of the Ministry of Economy and Finance, said at a comprehensive National Assembly audit by the Strategy and Finance Committee on the 30th, "If we do a currency swap, we would have to pay about 4% interest," adding, "It is far more favorable to the national interest."
Koo, the deputy prime minister, gave this answer to a question regarding the outcome of negotiations on a U.S.-bound investment fund between Korea and the United States, in which the two countries set an annual cap of $20 billion in cash investment without a currency swap.
Koo explained, "If we were to invest $20 billion (the annual cap under the Korea-U.S. negotiations), and if there are difficulties in the foreign exchange market, lowering this (the annual payment amount) would not even incur an expense and would be far more favorable to the national interest, so we drew up negotiations in this manner."
Earlier, Presidential Chief of Staff for Policy Kim Yong-beom said in a briefing on the outcome of the talks the previous day that "in cases where instability in the foreign exchange market is a concern, we also prepared a separate basis to request adjustments to the timing and amount of payments."
When Democratic Party of Korea lawmaker An Do-geol asked that day about plans to raise $20 billion annually, Koo replied, "Basically, the revenue from managing our foreign exchange reserves is around $15 billion," adding, "If that is not enough, there will also be portions raised by state-run institutions and overseas."
Koo went on to say, "However, $20 billion is a cap (on annual investment). Because it is a 'maximum of $20 billion,' payments will be made according to the work completed (the amount actually injected), which can be less than $20 billion, and we took that into account."