JEJU -- Korea's central bank governor said Saturday that establishing a global financial safety net would help efforts to curb financial turmoil from unpredictable capital flows, as well as minimizing fallouts from a global financial crisis.

Kim Choong-soo, governor of the Bank of Korea (BOK), also said the financial safety net, designed to prevent sudden capital outflows from emerging countries, would help reduce the imbalance between developed countries and emerging economies.

"Regulations and oversight are not enough to guarantee the health of the global financial system," Kim told business leaders during a conference at on Jeju Island, according to a BOK statement.

"The global financial safety net would prevent developing countries from falling victim to the financial crisis sparked by advanced economies."

Korea felt the pains of the 2008 financial crisis triggered by the collapse of U.S. investment bank Lehman Brothers. The country's stock markets plunged as foreign capital eroded.

The global financial safety net would also reduce the needs for large foreign exchange reserves, Kim added. Emerging countries like China possess substantial foreign reserves partly to hedge the risk of unexpected flight of international capitals.

Korean President Lee Myung-bak proposed last month that leaders of the Group of 20 major economies join together to discuss ways to set up a global financial safety net during upcoming meetings.

Finance Minister Choi Kyung-hwan at the conference expressed confidence over the country’s strong footing towards economic recovery, citing strong exports performance.

He noted that Korea is on course to achieve a $30 billion trade surplus by year’s end, as it is expected to have already achieved its earlier forecast of $23 billion by the end of July.

"Our economy has been recovering at a faster pace than expected. It is a recovery led by exports and large business groups," he told the forum in the southern resort island of the country.

In the first half, the world's ninth-largest exporter posted a record trade surplus of $19 billion, topping the government's half-year forecast.

Demand for semiconductor parts and cars from China and other emerging markets powered exports higher, helping Samsung Electronics, the world's top memory chipmaker and Hyundai Motor to report their biggest-ever net profits during the first half.

The slowing down U.S. economy and the cooling Chinese economy may dampen global demand in the latter part of this year, but analysts say Korean exporters are seen as more resilient than their peers in the region thanks to their product competitiveness. The softening won is also believed to have been behind strong Korean exports.

The won is the worst performing currency in Asia, down 1.5 percent against the dollar on the year to date, due in part to government intervention seen as aiming to curbing the currency's advance so that exporters maintain price competitiveness over Japanese rivals in overseas markets.