The South Korean government plans to increase loans to private overseas resource development projects to better guard the country against sudden spikes in price, the Ministry of Knowledge Economy said on Thursday.

"The global financial crisis, drop in crude oil prices and unstable exchange rates are all casting shadows on natural resource development efforts, but Seoul plans to ensure adequate assistance to alleviate such concerns," Vice Knowledge Economy Minister Lee Jae-hoon said.

According to the ministry, loans by Export-Import Bank of Korea and Korea Export Insurance Corp have set aside around 2.8 trillion won (US$2 billion) worth of funds that can be drawn as loans and loan guarantees this year. The total amount is to be increased in 2009, the ministry said.

The ministry also said that a 120 billion won (US$85.7 million) worth of special funds will be created to further help exploration and development of raw minerals and energy resources.

The South Korean government has pushed both public and private companies to take greater part in foreign resource exploration and development as reduce its huge dependence on import.

Currently, South Korea imports 97 percent of its natural mineral and fuel requirements from abroad.

The country's self-sufficiency in oil and gas stands at around 4.2 percent, while that for copper, iron and coal are at 2 percent, 12 percent and 38 percent, respectively.

For other key resources, such as uranium and nickel, South Korea relies 100 percent on imports.

(Xinhua News Agency November 13, 2008)