Financial Services Commission chief Kim Seok-dong said on Monday that Seoul would increase financial support of companies’ large overseas projects such as nuclear power plants, offshore plants and urban development.

“In order to find major momentum for the financial industry, Seoul will beef up financing support of major overseas projects including mega-sized atomic power plants, urban development and offshore plants,” Kim told reporters in Seoul.

“Our companies’ reliance on European investment banks is declining, so we should foster Korean IBs to appropriately utilize Korean funds for overseas projects. It is also time for Seoul to consider launching a (state-funded) financial institution that backs green industries.”

Kim also said that low growth and low interest in Korea would continue for quite some time, noting that the eurozone, built upon a political cause, rather than an economic one, for “war-free Europe,” wouldn’t be able to get rid of its troubled parts, and therefore would struggle with the fiscal crisis for a lengthened period.

“The situation in emerging economies is not good. The global real economy won’t be doing very well next year,” he said.

“As for Korea, we have reached a limit in growth due to internal risks such as demographic changes and household debts in addition to external risks. We must secure new growth engines.”

Noting that the Korean financial system has improved greatly in terms of soundness, transparency and market stability over the past 15 years, Kim said that Korea’s financial companies must promptly expand abroad like how the country’s manufacturers grew overseas.

“Many countries in Asia including Indochina appreciate Korea’s advanced financial infrastructure. We should export our financial know-how and open new opportunities for homegrown IBs abroad,” he said.

By Kim So-hyun (sophie@heraldcorp.com)