South Korea Loosens Foreign Exchange Controls to Promote Won Internationalization on July 14

According to Jin10, South Korea's government announced on Tuesday, July 14 plans to ease foreign exchange restrictions as part of its strategy to promote the internationalization of the Korean won and expand its overseas use. The government released its "Economic Policy Direction for the Second Half of 2026," proposing measures including incentives for Korean won-denominated settlement of current account transactions and expanded channels for foreign investors to purchase won-denominated financial products.

The government will also relax borrowing restrictions on foreign financial institutions to improve their access to won liquidity for securities settlement, and plans to promote won-denominated trade financing through currency swap funds. Additionally, the government committed to establishing 24-hour market monitoring mechanisms and developing further measures to enhance the won's deliverable foreign exchange market in the second half of the year.