Korea - Sweden Communications

[Jay]

To: Swedish Finance Ministry < Connor >

From: Ministry of Economy & Finance

Subject: [Confidential] Line of Credit & Financing Discussion

Security: Private and encrypted Protected by the NIS and MoFA DPB

Dear H.E. Per Bolund,

I hope this email finds you well and in good spirits.

The Economic Intelligence Unit reported a backlog in international transactions the past couple of months that has led to an overestimation on the part of some countries of the current economic recovery. Due to the rise in India's debt and it's impact on Asian economic growth as well as the slow recovery in global economic health since the Russia Crisis, the effects have slowly trickled into the Republic of Korea. While so far through cash injections, buying up toxic corporate asserts in exchange for reform and oversight, and currency swaps, we've managed to keep the impact from being severe. The EIU report indicated that the Korean Macroeconomic situation was at risk of entering higher levels of debt than anticipated. Particularly policymakers overestimation on the economic recovery and injecting cash into the economy to infrastructure and weapons programs.

We have attempted to maintain fiscal spending in line with the appropriate spending models. Primarily to reassure investors Korea is stable for investment and highly profitable. FDI has grown since 1998 and peaked in March of quarter one of this fiscal year. Still, it did not reach the levels we expected, and the need for reforms on barriers of entry are needed. In anticipation of further spending expectations pushed by the Administration, I am reaching out to discuss if we could arrange a line of credit to maintain cash flow for Korea's economy. Primarily the loan would be aimed at keeping economic growth positive and offset high government purchases. The loan would be aimed at foreign weapons sales, domestic infrastructure projects, and debt repayment. At this stage we are looking at approximately securing a loan for between $10-$15 billion (10,000,000,000.00 - 15,000,000,000.00) and I hope we can discuss the financing mechanism, interest rates applied, and other necessary items for securing this loan. Alongside a timeline to repay the loan and favorably benefit both parties.

Signed,
H.E. Minister Shin Shinyoung
Minister of Economics and Finance
Republic of Korea

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Republic of Korea
Ministry of Foreign Affairs
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