Furthermore, transparency in corporate governance has substantially improved. I believe Korea's debt servicing capacity is quite manageable, given Korea's sufficient foreign currency reserves, continued current account surplus, and steady inflow of foreign investment. We anticipate that the surplus will be sustainable, although the figure is likely to decline in 1999. In 1998, the large current account surplus was due to the decrease in imports. In 1999, recovery in both exports and imports are expected.
Exports are likely to grow as Asian economies begin to recover.
Imports too are expected to head up as demand starts picking up. Global demand for semiconductors and automobiles, Korea's major export items, is forecast to grow in 1999. The policy focus in 1998 has been setting up the hardware aspects of reform, that is, structural and institutional improvements, whereas the focus in 1999 will center more on the equally important software. Applications of global standards in financial and corporate sectors, management renovations and strengthening transparency are among targeted policy objectives. Particular emphasis will be placed on enhancing the growth of human capital.