Korea and China Extend 70 Trillion Won Currency Swap for 5 Years

Same Scale and Duration as Before

Yonhap News Agency

On November 3, the Ministry of Economy and Finance announced that the Bank of Korea and the People's Bank of China had extended the currency swap agreement between the Korean won and the Chinese yuan on November 1.

An inter-country currency swap is an agreement that allows each country to deposit its own currency and borrow the other country's currency at a pre-determined exchange rate in times of need. It serves as a safety net for the foreign exchange market when there is an urgent need for foreign currency funding.

Both the contract amount and duration remain unchanged at 70 trillion won (approximately 400 billion yuan) with a maturity of five years. As a result, the currency swap will be extended until 2030.

The Ministry of Economy and Finance stated that the purpose of this currency swap agreement is to promote trade between the two countries, stabilize financial markets, and support liquidity for financial institutions operating in each other's countries. The ministry added that it is expected to contribute to facilitating bilateral trade and stabilizing regional financial markets.

This renewed agreement was made on the occasion of the Korea-China summit held in Gyeongju on November 1.

This content was produced with the assistance of AI translation services.