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E Asia Should Resist Devaluation, Protectionism: S Korea Official

June 3, 1999

TOKYO (Nikkei)--Lee Hun-jai, chairman of the Financial Supervisory Commission of South Korea, said Thursday it was crucial that East Asian governments agree to resist the urge to devalue their currencies and engage in protectionist trade policies.

The South Korean government official spoke at the two-day Future of Asia conference in Tokyo sponsored by Nihon Keizai Shimbun Inc.

In order to prevent further currency crises due to movements of short-term capital, East Asian nations should coordinate policies, build a regional early warning system and set up an emergency credit line, Lee said.

South Korea has overcome its currency and financial crises by putting the top priorities on implementing comprehensive structural reforms urged by the International Monetary Fund, and on regaining international confidence, Lee said.

South Korea rehabilitated its financial system through radical reforms, including trimming the number of banks from 27 to 17, and this led to quick recovery, Lee said.

(The Nihon Keizai Shimbun Thursday evening edition)

Titles of speakers, names of companies, etc., were correct as of the time when the forum was held.