Seoul unveils reforms to remove capital controls and expand won convertibility, aiming to deepen liquidity and lower transaction costs.
South Korea’s finance ministry announced plans to make the won freely convertible, easing access for foreign investors and corporates. The reforms include 24/7 electronic trading and benchmark rate adjustments to reduce volatility and transaction costs for exporters and importers.
The roadmap phases out structural barriers like domestic bank account requirements and prior reporting rules for capital transactions. Officials cited the country’s economic fundamentals and mature capital markets as justification for the shift, which is expected to enhance won stability over time.
While the changes are structural and gradual, traders view them as a long-term positive for Korea’s capital market standing. Near-term market impact is expected to be limited, with effects building as offshore settlement infrastructure develops.