Yuliia Svyrydenko: USD 2.1 billion of concessional loans from the Republic of Korea will be used for recovery projects
Ukraine's economy will receive concessional loans equivalent to USD 2.1 billion from the Economic Development Cooperation Fund (EDCF) over the next five years. The draft Framework Agreement between the Government of Ukraine and the Government of the Republic of Korea was approved by the Cabinet of Ministers of Ukraine at a meeting on 2 April 2024. Yuliia Svyrydenko, First Deputy Prime Minister of Ukraine, Minister of Economy of Ukraine, was entrusted with signing the Framework Agreement on behalf of the Ukrainian Government.
"We have made another step towards finalising all the necessary internal procedures and starting the practical implementation of the agreements with our Korean friends. Ukraine or a resident of Ukraine who receives a state guarantee will enjoy the opportunity to attract concessional loans from the EDCF. The funding will be used for the purchase of equipment and for rehabilitation projects," said Yuliia Svyrydenko.
Under the terms of the Framework Agreement, the Government of Korea enables the Borrower to receive loans from the EDCF up to a maximum commitment in Korean Won not exceeding the equivalent of two billion one hundred million US dollars (USD 2,100,000,000) for the period 2024 - 2029 to finance EDCF loan projects in Ukraine. The governments of Korea and Ukraine are to identify candidate projects in close cooperation with each other. The details of each individual project, the amount and terms of the loan will be specified in separate loan agreements concluded between the Export-Import Bank of Korea and the borrower.
As a reminder, the EDCF Loan Agreement was signed by Yuliia Svyrydenko, First Deputy Prime Minister of Ukraine and Minister of Economy of Ukraine, and Kim Hyung-Tae, Ambassador of Korea to Ukraine, on 13 September 2023 in the presence of President of Ukraine Volodymyr Zelenskyy and Won Hee-ryong, Minister of Land, Infrastructure and Transport of Korea. The document was ratified by the Verkhovna Rada of Ukraine on 21 December 2023.
Under the Agreement, at the first stage, such loans can be used to supply equipment. Starting from 2025, it will be possible to attract infrastructure loans for reconstruction.
Background Information
The Economic Development Cooperation Fund (EDCF) was established by the Government of the Republic of Korea to promote economic cooperation between Korea and developing countries. The Fund provides financial support to partner countries for their industrial development and economic stability.