ANNOUNCEMENT 25 Feb 2010In February 2010, the government of Republic of Korea announced a change in its trade finance instruments.
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'Korea Eximbank provides USD 238 Million through Project Financing for "Indonesia Cirebon Independent Power Producer," ' Press Release available at http://www.koreaexim.go.kr/en2/01_exim/04_bank/01_view.jsp?nCP=1&nRegNo=457&cUseYN=&nSSecNo=9&sSKeyword=
The Export-Import Bank of Korea will provide US$238 million in financial support for the Indonesia Cirebon Independent Power Project. This announcement, made on 23 August 2010, also implies that the conditions of competition were affected by this and other potential financing deals. The Export-Import Bank's press release states:
"Korean corporations will participate in the entire process of the project, from construction to the supply of fuel. Korea Midland Power Corporation will participate as the operator of the project, Samtan Co. Ltd will be responsible for the supply of coal, and Doosan Heavy Industries & Construction Co. Ltd will participate as the power plant exporter.
"This project is the first independent power project in Indonesia since the Asian economic crisis in 1997. This project will play a great role in facilitating Korean businesses' participation in Indonesia's power plant projects, and will be a role model for many following projects afterwards. By agreeing to support the "Indonesia Cirebon Independent Power Project" with USD 238 million, or 40% of the entire loan project amount, the Bank contributed greatly to forming the international financial package."
Moreover, according to a Bank representative, "This project is expected to highly stimulate job creation in related industries as Korean companies have a substantial role in the construction and operation of the project. As such, this project will serve as a new model for overseas expansion of power projects."