Share prices have risen moderately in South Korea spurred by the interest shown in investing in the country by the international financier, George Soros.

The benchmark stock index rose by 11 points, or 3%, closing at 396.49. It had closed at 385.49 Saturday, a 2.43% gain.

In Britain the FTSE-100 index on Monday was up 34.3 at 5227.8.

BBC correspondent Charles Scanlon reports from Seoul (Dur: 1'16")

But across the Asia region, currencies have sunk to record lows against the dollar in early trading on Monday.

The South Korean currency, the won, was lower in its first trading session of the year because of continued demand for dollars by importers.

The won closed at 1,770 against the dollar, down from 1,695 in the last 1997 trading session.

Soros promises $1bn

Goerge Soros at the news conference

Foreign financier George Soros has expressed an interest in investing in South Korea.

At a news conference in Seoul on Monday, Mr Soros said investment in South Korea through the funds he manages could rise "quite substantially" and he promised up to $1bn.

This announcement comes after accusations last November, by the Malaysian Prime Minister, that George Soros was partly responsible for the financial crisis in the Asian markets. Dr Mohamad Mahathir attacked the financier for manipulating stock and foreign exchange markets for his own gains.

At the conference Mr Soros said: "Korea has severe problems but it can overcome them in a relatively reasonable period of time, and it can be done by radical restructuring of its economy."

He said he plans to send a team of his investment experts to South Korea soon to study the possibility of putting more money into local markets.

To help regain investors' confidence, Mr Soros said South Korea should speed legislation to make layoffs easier, a recommendation accepted by President-elect Kim Dae-jung.

'A year of trouble'

Like other Asian currencies, the won, has continued to fall against the dollar

Kim Dae-jung has asked parliament to convene in mid-January, three weeks ahead of schedule, to pass bills that would allow mass redundancies.

Declaring that 1998 will be a year of trouble, Kim appealed to the nation to share the pain "on an equal footing."

"As was often the case in the past, there will be no unilateral imposition of sacrifice on certain limited quarters of the society. All should share the pain," Kim said in a New Year speech to his party leaders.

The President-elect's term of office begins on 25 February. As part of his austerity campaign to help South Korea out of its worst economic crisis, he has pledged to halve the presidential staff and make government more efficient.

Short term loan fear

According to analysts there is fear over South Korea's ability to meet its short-term debt payments this month.

South Korea's short-term debt includes $12.2bn due in January, $5.1bn in February and $4.3bn in March.

The Thai government is tryng to renegotiate its IMF rescue package

The country has received $11bn of the International Monetary Fund's $57bn loan, but the amount still may not be enough to put an end to the financial troubles.

In Thailand the Prime Minister, Chuan Leekpai, has said his government will try to renegotiate the terms of its $17bn rescue package with the IMF.

He said Thailand was unlikely to meet an IMF condition of producing a cash surplus equivalent to 1% of its gross domestic product.  
 

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