KOREA PLANS TO OPEN MARKETS TO EASE WON PRESSURE

  South Korea will further open its market
  to help cut its trade surplus with the U.S. And to fight off
  pressure to revalue the won against the dollar, a government
  spokesman said.
      The spokesman said Korean trade minister Rha Woong-Bae's
  stand in Washington yesterday against pressure from industrial
  nations to revalue the won underlined the government's
  determination to stand firm.
      Rha told the U.S. Chamber of Commerce "Demands that Korea
  carry out a drastic and sudden currency revaluation of five or
  10 pct are, I believe, extremely ill-advised."
      Deputy prime minister Kim Mahn-Je told a meeting of local
  businessmen "The government's policy on the question of
  revaluing the won is to maintain a steadfast position."
      Kim said South Korea was ready to move slowly to raise the
  won's value because of its heavy foreign debt which stood at
  44.5 billion dlrs at the end of 1986.
      Six industrialised nations agreed in Paris last month that
  newly industrialising countries, such as South Korea and
  Taiwan, should allow their currencies to appreciate.
      But local businessmen have said won/dollar parity has
  already reached "a crisis level."
      An official of the Korea Traders' Association (KTA) said if
  the won strengthened another five pct, this would mean the loss
  of profitability for nearly half of all South Korean exporters.
      "We are determined not to go the way of Latin American
  debtor nations which have suspended interest payments of their
  debts," the spokesman said. "The only way to keep our good record
  is to maintain our exports.+
      The trade minister said yesterday should Seoul revalue the
  won suddenly Korea would run "a tremendous trade deficit and
  could degenerate into a country, like many other developing
  countries, which is reneging on its international obligations."
      The spokesman said South Korea had been gradually
  appreciating its currency, ruling out a major revaluation. So
  far this year, the won has gone up by 0.8 pct against the
  dollar after a 3.34 pct revaluation in 1986.
      He said South Korea was selecting "many" of 122 items on
  which Washington recently asked Seoul to lower tariffs to help
  narrow its trade surplus with the U.S. No further details were
  given.
      Seoul announced in January the lifting of bans on 158
  items, including sensitive agricultural products and large
  cars, effective from July.
      South Korea posted its first ever current account surplus
  last year, due largely to a trade surplus with the U.S. Of 7.1
  billion dlrs, against a 4.3 billion deficit in 1985. It earlier
  forecast that its current account surplus could reach eight
  billion dlrs this year.
      But the government official said the surplus would be held
  at around five billion dlrs to avoid further pressure by
  industrialised nations to push up the value of its currency.
  

