Asia Pacific

China-South Korea business ties pushed after currency swap extension

Visiting South Korean President Park Geun Hye on Friday said it is important for South Korea and China to deepen economic ties in response to their strengthened political cooperation.

In a speech to business leaders of the two nations in Beijing, Park said that to do so, a firm framework offered by a free trade deal being negotiated between the two is essential.

Their central banks on Thursday agreed to extend an existing won-yuan currency swap worth 64 trillion won (about $55 billion) by three years. The size of the swap, set to expire in October 2014, can be expanded if needed.

The Bank of Korea said the extension removes uncertainty over liquidity stemming from the looming expiration.

Given that the BOK and the Bank of Japan ended a currency swap worth $3 billion due to expire on July 3, its economic overtures to China are raising eyebrows..

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