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South Korea, Australia Ink US$ 4.5 Billion Currency Swap Agreement

The Bank of Korea and Reserve Bank of Australia struck a bilateral local currency swap agreement on Sunday. The deal, which is effective for three years unless extended through mutual consent, allows the exchange of up to 5 trillion won for 5 billion Australian dollars (US$ 4.5 billion).

“The agreement will ensure that trade between the two countries can continue to be settled in local currency even in times of financial stress,” the central banks said in a joint press release later that day. “The agreement can also be used for other, mutually agreed purposes.”

The central bank governors, Kim Choong-soo and Glenn Stevens, signed the agreement in Sydney while attending the G20 summit. Bilateral trade between the two countries in 2013 totaled around US$ 30 billion, ranking Australia the seventh largest trading partner for South Korea and South Korea as Australia’s fourth largest.

South Korea, trying to dampen the effects of volatile foreign capital flows, has penned similar currency swap accords, weighing in at about US$ 120 billion, with other countries in the past, including a multilateral arrangement for US$ 56 billion with China and US$ 10 billion with Japan. Additionally, South Korea has deals with United Arab Emirates, Indonesia, and Malaysia for US$ 5.4 billion, US$ 10 billion, and US$ 4.7 billion, respectively.

UNICEF and NBIM to Host Meetings on Children’s Human Rights

The United Nations Children’s Fund (UNICEF), a United Nations programme headquartered in New York City, has partnered with Norges Bank Investment Management (NBIM) to facilitate a series of meetings between companies to discuss issues surrounding children’s human rights.

According to the news release, “the network will facilitate dialogue between leading brands and retailers in the garment and footwear industry to strengthen children’s rights.”

NBIM is invested in many listed companies and have invited them to join a network to tackle these issues. Over the next two years, the organizations plan to hold three workshops as well as quarterly meetings surrounding these issues.

“Over time, we hope and expect that the network will contribute to improved market practices among companies and greater respect for children’s rights,” says Carine Smith Ihenacho, Global Head of Ownership Strategies, in a NBIM press release.

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SouthGobi’s CEO Arrested, CIC Struggles with Investment

The China Investment Corporation (CIC) has long struggled with its investments in coal assets, specifically in globally-listed coal miner SouthGobi Resources Ltd, which operates its flagship coal mine in Mongolia. In November 2009, CIC and SouthGobi Resources inked a convertible debenture deal. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Qatar Central Bank Deals with MSCI

MSCI, a stock index company whose benchmarks influence investor behavior, has tremendous indirect power impacting the stock markets of smaller economies. In 1988, MSCI released its emerging markets index, a now-widely-used benchmark for many institutional investors wanting access to growth markets. China and South Korea make up the majority of the benchmark, but smaller economies such as Poland, Chile and even Qatar make up other pieces of it.

[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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