The Export-Import Bank of Korea (www.koreaexim.go.kr, Chairman Lee Duk-hoon, “Korea Eximbank”) announced on March 19 that it will provide a total of USD 25 million in EDCF* loans for the Expansion of Thien Tan Water Plant Project-Phase II and Support Program to Respond to Climate Change-Phase III launched by the Vietnamese government.
- The Economic Development Cooperation Fund (EDCF) was established by the Korean government in 1987 to promote economic exchanges with the developing world and to assist developing countries in achieving industrialization and economic stability through the provision of long-term, low-interest credit. As of February 2015, EDCF has committed over a total of KRW 11.6 trillion in loans for 334 projects in 55 countries.
Korea Eximbank's Executive Director Yim Seong-hyeog met with Vietnam's Vice Minister of Finance Truong Chi Trung in Hanoi, Vietnam and signed the loan agreement.
The Expansion of Thien Tan Water Plant Project-Phase II is expected to greatly improve the regional economy and public sanitation by supplying water for industrial and residential usages in the Dong Nai industrial complex and residential areas.
The project received USD 26 million in EDCF loans in 2007. However, as the financial situation aggravated as a result of the 2008 financial crisis, additional financing for the project has been in great need. Hence, the Bank has decided to lend an additional USD 15 million in EDCF loans for the project.
With this loan agreement, it is expected that Korea's image as a key partner for economic growth in the Vietnamese market will be solidified.
The Support Program to Respond to Climate Change-Phase III to receive USD 10 million in EDCF loans is built upon Vietnam's National Target Program to Respond to Climate Change (NTP-RCC) and is part of the green program driven by the international community to support the designing and implementation of the policy and strategy to respond to climate change.
Currently, five major donor organizations including the World Bank, AFD (France), JICA (Japan), DAFT (Australia), and EDCF (Korea) are jointly participating in the support program.
The Vietnamese government is developing climate change policy and strategies in partnership with the five donor organizations. Loans will be extended according to the results of policy implementation.
Five donor organizations will be providing USD 220 million in loans to the climate change response program this year according to the policy implementation results in the previous year.
This support program is anticipated to greatly contribute to building the Vietnamese government's capacity to tackle climate change response. Furthermore, it will enable Korea build its international status that matches a country that attracted the Green Climate Fund headquarters and strengthen Korea's position as a leading country in climate change response.
Executive Director and Head of EDCF Operations Group Yim Seong-hyeog said at the signing ceremony, "This loan agreement will help build strong friendship and economic cooperation between our two countries." He added, "Going forward, we will reflect Vietnam's national development phase in designing development projects and proactively support various sectors such as climate change and environment in addition to building socio-economic infrastructure.
In the meantime, on March 17, Korea Eximbank established a loan agreement to provide USD 56 million in EDCF loans to fund Myanmar's IT Infrastructure Construction Project.
Executive Director Yim met with U Khin Maung Tun, Deputy Director of Myanma Posts and Telecommunications (MPT), and signed the loan agreement.
The project aims at building optical communications networks across 37 cities in Myanmar. It is expected to substantially enhance ICT development and industrial competitiveness.
