South Korea is considering pushing for a fresh free trade agreement with Britain which chose to leave the European Union, or Brexit, as part of its efforts to deal with the fast-changing global trade environment, the finance ministry said Friday.

In a minister-level meeting held in Seoul, the Ministry of Strategy and Finance said it will make various efforts to expand overall trade and minimize any possible Brexit spillover into the real economy, including signing a new FTA with Britain or upgrading terms of existing trade pacts.


South Korea has clinched a series of FTAs with major trading partners, including the U.S., the EU and China, in recent years as part of its efforts to boost the growth of its export-reliant economy.

Its exports to Britain totaled US$7.39 billion last year, taking up just 1.4 percent of the country's total outbound shipments.

To overcome the current exogenous headwinds stemming from the Britain-EU breakup, Finance minister Yoo Il-ho pledged that the authorities will manage the country's foreign exchange reserve in a stable way.

"To deal with rising financial uncertainties, we have to establish a firm safety valve," the minister said in the meeting.

"The economic authorities will work to manage foreign exchange reserves in a stable mode, the last bulwark of the South Korean economy."

The country's foreign exchange reserves came to $369.9 billion as of end-June, the seventh-largest following China, Japan, Switzerland, Saudi Arabia, Taiwan and Russia, in that order.

He also promised to reorganize the related regulations on raising emergency funds in order to take pre-emptive steps if various concerns are to become reality.

The top economic policymaker's comments came as the landmark British referendum on June 23 has jolted the global financial market.

The so-called Brexit sparked concerns that foreign investors would pull their money out of the South Korean stock market, where foreign ownership accounts for more than 30 percent, as part of their portfolio relocation strategy to reduce risky assets.

"The South Korean government is on full alert against any changes in the overseas market conditions," said Yoo, who also double hatted as deputy prime minister on economic affairs.

"We will carry out economy boosting measures and structural reform to help the economy stay afloat in possible financial turmoil."

The minister has stressed fiscal intervention into the economy, which has apparently lost steam due to faltering exports and flaccid domestic demand. (Yonhap)