South Korea’s short-term overseas debt fell last quarter, aiding government efforts to shield the nation from fallout from Europe’s sovereign-debt crisis.
Overseas debt maturing in one year or less declined $15.4 billion to $138.5 billion in the three months through September from the previous quarter, the first drop this year, the Bank of Korea said in a statement in Seoul today. Long-term external debt increased by $10.5 billion to $255.8 billion.
South Korea has stepped up efforts to reduce its short-term external debt and fluctuations in capital flows as Europe’s sovereign debt intensifies.
The nation tightened limits on currency-forward positions starting July 1 and imposed a levy on non-deposit foreign-currency liabilities held by domestic and foreign banks beginning Aug. 1, with short-term debt facing higher charges.