South Korea has announced a financial package that includes government guarantees to banks, to safeguard their foreign-exchange borrowings for the next three years.
The country - which has the third largest economy in Asia - seems particularly vulnerable to the global credit crisis, because its banks don't have enough dollars to service maturing foreign debt.
The finance ministry, central bank and financial services commission said the government expected about $100bn of borrowing to be covered by the package.
A further $750m will be injected into the Industrial Bank of Korea, so it can expand lending to small businesses.
In a statement, the government said it would guarantee for three years all external debt taken on by South Korean banks before 30 June 2009 in order "to avoid placing domestic banks at a comparative disadvantage in terms of overseas funding and to allay fears in the financial market".
Along with the Bank of Korea, it will also provide an additional $30bn of dollar liquidity to the banks by utilising foreign exchange reserves.
