Lee raises currency swap during Bessent visit as Korea readies for investment, seeks won stabilization

President Lee Jae Myung, right, and U.S. Treasury Secretary Scott Bessent meet at the Blue House in Jongno District, central Seoul, on May 13. [JOINT PRESS CORPS]

 

President Lee Jae Myung raised the need for a bilateral currency swap arrangement with the United States during his meeting with Treasury Secretary Scott Bessent at the Blue House on Wednesday, as Seoul seeks greater stability in foreign exchange markets and readies for a major investment push. 

 

Blue House spokesperson Kang Yu-jung said Bessent agreed with Lee’s views on bilateral cooperation and that the two countries would need to work closely together going forward. 

 


 

A currency swap is an agreement between two countries to exchange currencies at a predetermined rate at set intervals. It effectively gives each country access to a line of credit in the other’s currency — in Korea’s case, a deal with the United States could mean being able to draw on dollars from the U.S. Federal Reserve in times of market stress, without having to sell assets or seek emergency financing.

 

Bessent himself signaled openness to expanding such arrangements last month,
writing on X that “extending permanent swap lines can be a major first step in creating new U.S. dollar funding centers in the Gulf and Asia.” He added in the post that additional swap lines would strengthen dollar liquidity internationally, keep dollar funding markets functioning smoothly and encourage trade and investment with the United States.

 

Korea has pushed for an unlimited currency swap with the United States before, including during tariff negotiations last year, but Washington declined. Lee also raised the issue directly with Bessent in September of last year. 

 

The renewed request reflects Korea’s growing need for dollars as large-scale investments into the U.S. market are set to ramp up next month. Calls from financial markets for a swap deal have also grown louder this year as volatility in the won-dollar exchange rate has increased.

 

U.S. Treasury Secretary Scott Bessent arrived in Korea on Wednesday for talks with Chinese Vice Premier He Lifeng ahead of a high-stakes summit between U.S. President Donald Trump and Chinese President Xi Jinping in Beijing set to kick off Thursday. 

 

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.

BY YOON SUNG-MIN, JANG WON-SEOK [[email protected]]