AFFECTED FLOWOutflow (subsidised)
ANNOUNCED AS TEMPORARYNo
Financial assistance in foreign market
The cooperation agreement between the Korea Eximbank and the Democratic Republic of Congo concerns a “linked project for the SOC Construction and Resource Development”. Under the agreement Korea will construct a network of water supply pipelines in the country and Korea would, in turn, acquire development rights of the Musoshi copper mine. In this context, the Korean company POSCO, as a representative of the Resource Development Joint Venture formed by a number of Korean companies, also signed the above agreement.
In this context, the Korea Eximbank explained: “The resource development and SOC linked project model fully utilizes Korea’s core strengths in SOC construction technologies to secure the abundant natural resources of Africa. The model was strategically developed to increase Korea’s competitiveness against countries, which have already advanced into the promising market of Africa. This agreement is the first successful application of the model. “ and concluded that: “Korea Eximbank played a key role in the agreement. The bank developed and presented a business model, which satisfied the needs of the government of the DR Congo and the Resource Development Joint Venture."
In addition to the above agreement, Korea Eximbank also pledged a financing package amounting to a total value of USD 500 million falling under EDCF and natural resource financing.
The Economic Development Cooperation Fund
The EDCF provides low-interest and long-term credit to developing countries for projects seeking to promote industrialisation and economic stability. In some cases, Korean companies are involved in such projects directly or through exports. More information on the Fund can be found on the official website or the "Guide to the Import-Export Bank of Korea" publication.
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets and from foreign subsidiaries.
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