Korea and AfDB Extend their Projects Co-Financing Agreement to 2011-2013

15/09/2010
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Seoul, 15 September 2010 - The Korean Strategy and Finance Ministry and the African Development Bank (AfDB) signed in Seoul on Wednesday, 15 September 2010, a memorandum of understanding (MOU) extending their USD 200 million co-financing agreement to 2011-2013.

The agreement was signed on the sidelines of the Ministerial Conference on Korea-Africa Economic Cooperation (KOAFEC) by the Korean Strategy and Finance minister, Yoon Jeung-Hyun, and the AfDB President, Donald Kaberuka.

Commenting on the event, Mr. Kaberuka declared: “I very much welcome the generous and sustained commitment from Korea to the African Development Bank. This amendment will contribute to the Bank’s capacity to co-finance sovereign loans in Africa, and to sustain growth on the continent in the aftermath of the financial crisis.”

The Bank and Korea signed two other MOUs on a knowledge partnership strategy and trade investment promotion with the  Korea Trade Investment Promotion Agency. “The objective is to build further on the growing trade and investment flows between Korea and Africa, which since the KOAFEC process began, has gone from strength to strength”, said Mr. Kaberuka.

On 5 October 2009, the Korean Strategy and Finance ministry temporarily made available USD 306.1 million to the AfDB to enable the institution respond to African countries’ financial demands.

The decision was highly welcomed by the AfDB, since it enhanced the institution’s capacity to sustain its lending to African countries in a difficult economic context.

Korea also supported AfDB’s historic 200% general capital increase approved by the institution’s Board of Governors during the Annual Meetings in May 2010 in Abidjan, Côte d’Ivoire.

The Republic of Korea became a State Participant of the African Development Fund (ADF) on 27 February 1980, and was admitted into the African Development Bank on 30 December 1982.

Korea’s collaboration with the AfDB focuses on three main pillars: ADF replenishment; bilateral trust funds; and co-financing arrangement in addition to the provision of resources for the implementation of Heavily Indebted Poor Countries Initiative and the Multilateral Debt Reduction Initiative.

Korea will host next G20 Summit from 11-12 November 2010.