S. Korea proposes investment fund with Russia

SEJONG, Sept. 5 (Yonhap) -- South Korea's finance minister met with President Vladimir Putin's envoy to the Russian Far East on Thursday after earlier proposing the creation of a massive investment fund with Russia to develop key industrial materials, parts and equipment. Hong Nam-ki, the minister of economy and finance, held talks with Russian Deputy Prime Minister Yury Trutnev on the sidelines of the 5th Eastern Economic Forum under way in Russia's Far East city of Vladivostok, the ministry said. No details were immediately available. Earlier in the day, Hong said the fund could help Russia commercialize its basic science and technology for overseas sales, while South Korea could diversify import sources of key materials, parts and equipment. "I am confident that the fund would create a new value chain that would facilitate economic cooperation in the materials, parts and equipment sectors," Hong said in a speech to about 150 South Korean and Russian officials. He did not give any further details on the size of the proposed fund. The proposal is the latest in a series of South Korean efforts to cope with Japan's export curbs on key industrial materials against South Korea over a historical issue. South Korea is pushing for the localization of key industrial materials, parts and equipment to reduce its heavy reliance on Japan. In July, Tokyo imposed tighter regulations on exports to Seoul of three materials -- resist, etching gas and fluorinated polyimide -- that are critical for the production of semiconductors and flexible displays. Japan later removed South Korea from its list of trusted trade partners in retaliation for last year's South Korean Supreme Court rulings ordering Japanese firms to compensate South Korean victims of forced labor during Japan's 1910-45 colonial rule of the Korean Peninsula. This month, Seoul is set to drop Tokyo from its own list of favored trade partners. Hong also called for talks with the Eurasian Economic Union on a free trade agreement for broader economic cooperation beyond the Asia-Pacific and Eurasia. The bloc is composed of Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan. In June, South Korea launched free trade negotiations with Russia in the service and investment areas. entropy@yna.co.kr (END)