Eximbank finances Myanmar projects
Eximbank Chairman and President Lee Duk-hoon, fifth from left, stands together with officials from the Myanmar government and the bank, Monday, after signing an agreement to extend $183 million in ECDF loans to Myanmar state projects to build a bridge and provide new railroad cars. From left are Deputy Minister of Construction Win Myint, Minister of Construction Kyaw Lwin, Minister of Rail Transportation Nyan Tun Aung, Vice Minister of Rail Transportation Myint Thein, Lee, Korean Ambassador to Myanmar Lee Baek-soon, EDCF Asia Department Director-General Oh Eun-sang and Eximbank’s Yangon office chief Sohn Seung-ho. / Courtesy of Eximbank
By Choi Kyong-ae
The Export-Import Bank of Korea (Korea Eximbank) said Tuesday it will extend $183 million in loans to a Myanmar infrastructure modernization project, which it sees generating future business opportunities there for Korean companies.
“Under Eximbank’s Economic Development Cooperation Fund (EDCF)-based deal, the Myanmar government placed orders with Korean companies to build a bridge and replace its existing railroad cars with new ones in return for the 40-year low-rate loan,” a bank spokeswoman said.
The bidding process has yet to begin to select Korean construction companies for the Myanmar project, she said.
Once a Korean company is selected to provide railcars, some will be assembled in Myanmar as part of a manufacturing technology transfer, Eximbank said in a statement.
Korean companies are also expected to win local projects to upgrade railways and repair facilities, it said.
Eximbank Chairman and President Lee Duk-hoon signed the EDCF-based construction deal with Myanmar’s Deputy Minister of Construction Win Myint and Deputy Minister of Rail Transportation Myint Thein in the Southeast Asian country, Tuesday, the statement said.
Lee also met Myanmar President Thein Sein on the same day to exchange views on promoting bilateral cooperation between the two countries in the private sector, it said.
“Eximbank will hold a joint investment road show with Myanmar and its companies, make efforts to boost business ties between the Myanmar government and Korean firms, and diversify export financing to support those ties,” the Eximbank chief said.
The $183 million loan is Korea’s second EDCF-based deal of its kind with Mynamar. In 1996, Eximbank extended a $20 million EDCF loan for a railroad car purchase project. The Myanmar government is still paying back the loan with a maturity of 30 years, according to Eximbank.
“The low-rate EDCF loans given to developing countries are not designed for investment gains. They are just to help emerging countries stand on their own feet in terms of industrial development,” the bank spokeswoman said.
As of the end of October, Eximbank extended a total of $423 million in EDCF loans to 10 state projects in Myanmar. Separately, the bank extended a total 580 billion won ($496 million) in export financing to Korean companies advancing into the country, the statement said.
Across the world, the bank has approved an accumulated 12.2 trillion won for 338 projects in 52 countries from 1987 through October this year, it said.