Ukraine to receive up to $8 bln from S. Korea's EDCF - Economy Ministry

MOSCOW. May 17 (Interfax) - Ukraine will gain an opportunity to receive the first tranche of up to $300 million from South Korea's Economic Development Cooperation Fund (EDCF, a branch of the Export-Import Bank of Korea) in 2023, Ukrainian media said, citing a statement by Ukraine's Economy Ministry.

Ukraine has been added to the list of priority countries for bilateral cooperation with South Korea under the Official Development Assistance (ODA) program. The money may be provided within 3-4 months after the second stage of the agreement is signed, which is expected to happen in a month's time, the ministry said.

"The next tranche of up to $3 billion will become available in 2024 with a gradual increase of the limit to $8 billion, as the pipeline of the projects fills up. In addition, Ukraine will be able to take advantage of Korean capacities and experience in rebuilding infrastructure, industrial and civilian facilities," the ministry quoted Ukrainian First Deputy Prime Minister and Economy Minister Yulia Sviridenko as saying in a statement following the signing of a preliminary intergovernmental agreement on loans from the EDCF.

These will be long-term loans granted at minimum interest: the term of the loan could be up to 40 years at 0.15% per annum with a 10-year deferment for repaying the principal on the loan.

"We hope that all formalities will be finalized within the next few weeks, and we will be able to present the first projects that the fund will be able to finance to the business communities of our countries," Sviridenko said.

Individual loan agreements will be signed in order to raise financing for specific projects. The South Korean government, in turn, will be able to issue grants and provide technical assistance for project preparation and evaluation. The EDCF also plans to open its office in Ukraine.

"We count on the active participation of Korean business in the reconstruction of our country, and the document signed today will help secure considerable investments from South Korea for opening new technological enterprises in Ukraine's strategically important sectors in partnership with global Korean corporations," Sviridenko said.

The EDCF was founded by South Korea's government in 1987 to promote economic cooperation between South Korea and emerging markets.