Sri Lanka enters in to loan agreement of US$ 500 million with Korea Exim Bank
Sri Lanka’s Finance Ministry has issued a statement announcing that Sri Lanka has entered into a US$ 500 million loan agreement with the EXIM Bank of Korea to finance development projects.
In order to further strengthen the economic cooperation between the two countries, the Government of the Republic of Korea has reportedly agreed to provide concessional loans from the Economic Development Cooperation Fund (EDCF) of the Export Import Bank of Korea (KEximbank).
Accordingly, the Government of Republic of Korea and Government of Sri Lanka have signed a new Framework Arrangement for the period of 2020-2022 to obtain loans through EDCF up to an aggregate commitment amount of US$ 500 million to finance mutually agreed projects.
The loan interest rate on this concessional loan is about as low as 0.15-0.20% and the loan has a repayment period of about 40 years with a grace period of 10 years, according to local media reports.
In addition, the two sides have reportedly agreed to continue the Korean Exim Bank Representative Office, which was opened in Colombo in January 2016 by its Chairman, to further implement the projects in a well-coordinated manner.
The Framework Arrangement was signed by Sri Lanka’s Finance Ministry Secretary S.R. Attygalle on behalf of the Government of Sri Lanka and Korean Ambassador to Sri Lanka Woonjin Jeong on behalf of the Korean Government.
OSL take:
Sri Lanka is engaged in an aggressive development programme that will take the country to the next level of development. Sri Lanka’s economy has shown great resilience to external and internal challenges through the years and is once again on the path to recovery after facing the impact of the global Covid 19 challenges. The level of confidence enjoyed by Sri Lanka among bilateral and multilateral donors is evident by the funds that are being assigned to Sri Lanka’s development programme. The island’s geographical positioning in the Indian ocean and the many trade agreements as well as trade concessions enjoyed by the country have helped Sri Lanka place itself as a business destination in the South Asian region. Foreign businesses/investors could therefore explore business/investment opportunities in Sri Lanka’s development programme.
| Article Code : | VBS/AT/20210517/Z_1 |