Take the IMF crisis back in mid 1997 as an example. The Won was critically devalued to 1800Won to 1USD from 800Won to 1USD, people were losing jobs, major companies were crashing down. It was absolute mahem. The Koreans rallied.
The Koreans secured loans from the IMF, cleaned up in-house issues and by half way through 1998 the Won had recovered to around 1300 Won.
10 Years of Korean Won Exchange Rates
Korean Won Exchange Rates for the past 10 years in USD, CAD, GBP and AUD
source: Bank of Canada Exchange RatesAs you can see from this graph, the Won has remained very constant over the past 10 years since the IMF bailout. The recent decrease in the value of the Won can be attributed to the global economic slowdown, decreased export sales results in a weakened economy for Korea but all is not lost. Sales may not dip when one considers a weaker Won and a stronger American dollar... I am a teacher, not a currency trader so I can't comment with absolute conviction but I can say, I have been involved in Korea since 1995 and I am very confident in the Won recovering very quickly. My personal opinion is that the Won will strengthen past it's original position at the beginning of this fiscal year.
On an aside note, when North Korea finally crumbles and the two Koreas are reunited, we will see another major dip in the value of the Won but this will be a very shortlived devaluation. The merging of the two Koreas will mean direct market access by land to the rest of Asia and Europe. It will also mean direct access to untapped and untouched resources. Again, I am merely a teacher... but I really don't think this is that far away...
Korean Won Exchange Rates from January 2, 2008 to October 24, 2008
source: Bank of Canada Exchange Rates
Korean Won Exchange Rates in USD
source: Bank of Canada Exchange Rates
Korean Won Exchange Rates in Canadian Dollars
source: Bank of Canada Exchange Rates
Korean Won Exchange Rates in Great Britain Pounds
source: Bank of Canada Exchange Rates
Won Exchange Rates in Australian Dollars
source: Bank of Canada Exchange Rates
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“I'd like to start off by saying that my choice to teach abroad in Korea was one I know I will never regret! Footprints made it very easy to communicate with the school regarding details of where I'd be living and what I'd be teaching as well as taking care of my flight information. At the airport the morning we left, my boyfriend and I encountered overweight bags and extremely long lines at security, and we missed our flight by literally one minute. As we watched our plane pull from the gate, we just about lost our minds and any hope that we'd make the long journey we'd been planning for so long. We made one simple phone call to the travel agent, Claus, that Footprints set us up with. It was 6AM where he was on a Monday morning when we called in a panic. He said, "Stay by your phone," and we knew that he would fix this fiasco for us. Luckily, while Claus was searching for a solution, a woman from United Airlines was able to book us on another flight so that we would make our connection out of the U.S. to Seoul. We would like to thank Claus and Laina at Footprints for all their help in getting us to Korea!
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