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Technology Stocks : Alliance Semiconductor
ALSC 0.8100.0%Jul 10 5:00 PM EST
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To: Norrin Radd who wrote (4751)3/10/1999 10:18:00 AM
From: DJBEINO  Read Replies (1) of 9582
 
U.S. says to halt S.Korea loan if subsidies found
WASHINGTON, March 9 (Reuters) - The United States on Tuesday threatened to cut off international lending to South Korea should the country's government be found providing unjustified subsidies to struggling industrial groups.

''If there is direct government involvement in these corporate workouts, or if there (are) direct or indirect government subsidies for these workouts, the United States will vote its shares not to allow (International Monetary Fund) funding to be provided,'' U.S. Treasury Under Secretary Timothy Geithner told a Senate Banking subcommittee.

''Our policy will be to oppose further IMF disbursements if Korea does not satisfy its commitments in the IMF program,'' he added. ''We are concerned about this issue...and will make sure that we base that judgment on the best information we have.''

The IMF arranged a massive $58.35 billion international bailout package for South Korea in December of 1997 to help the country overcome the effects of a deep financial crisis. The package included $21 billion from the IMF itself.

In return, South Korea's government promised to implement a harsh set of economic reforms. As part of those reforms, it committed itself to overhauling and downsizing the country's huge family-run conglomerates, known as chaebols.

With 18 percent of member votes, the United States is by far the fund's biggest -- and its most powerful -- member.

biz.yahoo.com
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