SEOUL (AFP) -- South Korean President Lee Myung-Bak said on Sunday that his administration planned further tax cuts and would expand government spending to prop up the ailing economy.

Lee urged key advisers and ministers in a meeting to stop the financial crunch spilling into Asia’s fourth largest economy, his spokesman Lee Dong-Kwan said in a statement afterwards.
“The government’s scheme to push for additional tax cuts and expand its fiscal spending must ensure that the financial crisis will not lead to a slump in the real economy,” the president told the meeting.
“Under the current circumstances, what views foreign investors take about our economy and market is more important than anything else.”
The president’s office did not elaborate further on more tax reductions or government spending. The finance ministry would not immediately comment.
Lee, who returned Saturday from a summit of Asian and European leaders in Beijing, used Sunday’s meeting to try to soothe concerns over foreign currency and stock markets, his office said.
He ordered the cabinet to better explain government policies to foreign investors and work with the international community on follow-up measures to fight the global financial crisis.
Data Sunday from the Financial Supervisory Service shows foreign investors are selling local stock here at a record rate.
The statistics, disclosed by Yonhap news agency, said the investors sold a net 42.61 trillion won (29.59 billion dollars) worth of stocks this year, the highest volume since the 1992 opening of the local market.
Analysts say South Korea and other emerging markets are under pressure as investors scramble to reduce overseas exposure and secure liquidity to weather the global credit crisis.
Prime Minister Han Seung-Soo, Finance Minister Kang Man-Soo, central bank chief Lee Seong-Tae, Financial Services Commission Chairman Jun Kwang-Woo and senior presidential economic aide Bahk Byung-Won took part in the meeting.