Despite the fact that it experienced record capital outflows in 2008, South Korea has no plans to halt record purchases of its bonds by foreign investors, and will also sell 30-year bonds that are aimed at investors from outside the country.
Bloomberg reported Sunday that, according to the Financial Supervisory Service, a record 88.5 trillion won ($78 billion) in South Korean bonds were held in March after the figure was boosted by investor funds from outside the country. In addition, the government had announced in January plans by its finance ministry to sell 30-year bonds beginning in September. It hopes to raise 400 billion won each month through those sales.
Shin Hyung Chul, director general of the treasury bureau at the Ministry of Strategy and Finance, said in the report that the foreign investment level was “manageable” and the country does not plan to restrict it. In fact, the government intends to “gradually increase” the issuance of securities that take ten years or more to mature so that it can stabilize its fundraising.