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RoK shares post-crisis market recovery
Experts have cited success from the Republic of Korea (ROK), including investment in the Forex market and a “Government of Economic Emergency,” in recovering from the 2008 crisis to its current 12 th largest economy status, as an example for Vietnam today.
Experiences shared at a workshop held in Hanoi on August 17 showed that the RoK government spent 130 billion USD to stabilise the foreign exchange market at the worst point of the financial market in 2008. The Government signed a swap contract with the US Federal Reserve to reduce pressures on lowering interest rates.
Such contracts with the Federal Reserve as well as with Japan and China were called “quick measures” by experts and designed to stabilise the financial market. The experts advised Vietnam to consider these measures in order to cope with possible negative impact on economic recovery caused by open policies.
Other experiences included a “Government of Economic Emergency,” that the RoK established in 2009 with a system of measures to cope with crisis. They highlighted timely adjustments to State budgets to make up for unexpected spending, the issuance of tax policies in favour of purchasing power and increasing the liquidity of RoK and foreign currencies.
Restructuring key industries such as construction, shipbuilding and transportation as well as enterprises, especially those at high risk of bankruptcy, was another major lesson RoK experts shared at the event.
They called on Vietnam, which has emerged as a leading world exporter in products such as rice, coffee and wooden furniture, to boost the service industry based on domestic demands in order to reduce risks from huge dependence on exports, which are largely sensitive to global economic changes.
Economies, including Vietnam, should stay alert against a relapse into another global crisis, despite signs of a rebound in developing economies, as risks still loom over the world, economists warned.
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