South Korea will take necessary steps to stabilize its markets in case any additional provocations by North Korea result in heightening geopolitical risks, a senior finance ministry official said Saturday.
The steps will be part of what is specified in contingency plans the government came up with to prepare for all stages of situations, Vice Finance Minister Shin Je-yoon told a meeting with other policymakers.
"The government is seeing that the U.N. Security Council's decision to impose sanctions on the North will have a limited economic impact," Shin told the meeting aimed at reviewing the impact of heightened tension on the Korean Peninsula after the United States imposed toughened sanctions on the North for its nuclear test.
"(However) with the U.N. resolution getting tougher than before, concerns are being raised that North Korea could engage in other provocative acts," he said. "If more provocations result in raising geopolitical risks further, we cannot rule out the possibility that they could have a ripple effect on our financial markets and real economy."
He said that the government will take any necessary measures in accordance with its contingency plans to stabilize the market when market anxiety deepens due to the North's more provocations.
The meeting comes as concerns are growing that the country's financial markets could get disrupted as tensions are rising following the U.N.'s sanctions on the North and Pyongyang's increased saber-rattling rhetoric in recent days.
The government plans to hold its daily meetings of related policymakers to brace for worsening situations and beef up its market monitoring to stave off disruptions in a preemptive manner.
Shin said that the government will make more efforts to provide accurate information on the Korean economy to foreign investors, credit appraisers and media in order to prevent any unfounded fears from hurting the market. (Yonhap News)