South Korea and the United Arab Emirates(UAE) have extended their currency swap agreement by five years.
 
Under the five-year deal announced by the Bank of Korea(BOK) on Wednesday, the two countries can exchange currencies worth six-point-one trillion won or 20 billion dirham.
 
Set to expire on April 12, 2027, the renewed deal could be further extended upon mutual approval.
 
South Korea and the UAE's central banks had first signed a three-year currency swap agreement in October 2013 to promote bilateral trade and strengthen cooperation in finance. They concluded another three-year deal in April 2019.
 
According to the BOK, the two sides shared the view that their currency swap has contributed to enhancing mutual cooperation, and they agreed to extend the previous three-year deal to a five-year deal to maintain it in a stable way. 
 
A currency swap agreement allows a country to exchange its currency into another country’s currency or dollars in times of emergency such as a foreign exchange crisis.