Korea provides $ 290 m soft loan
A framework arrangement which will enable the Sri Lankan government
to obtain a soft loan from the Korean government up to US$290 million
till 2015 was signed on December 31, 2012. The framework arrangement is
based on the MoU signed between the two countries at the summit meeting
during the state visit of President Mhainda Rajapaksa to Korea last
April.
The two governments are expected to work closely to develop a range
of projects including construction of administrative complexes,
renewable energy plants and infrastructure development.
The projects will be facilitated by the Korean embassy and Export and
Import Bank of Korea. The soft loan of the Korean government, referred
to as the Economic Development Cooperation Fund (EDCF), was established
by the Korean government on June 1, 1987 to promote economic cooperation
between Korea and developing countries and to share Korea's own
development experience.
The EDCF's favourable financing terms include its comparatively low
interest rate of 0.1 percent per annum and a lengthy repayment period of
40 years.
Sri Lanka is the fourth largest recipient of EDCF with approximately
US$ 0.5 billion of the fund spent on 23 national projects from 1991 in
the areas of water supply, irrigation, energy, transport and
establishing social safety networks.
The projects have been carefully selected through in-depth assessment
and multiple discussions to draw out Sri Lanka's developmental
challenges and to reflect the country's development needs.
Some of the most recent projects under EDCF include the
Padeniya-Anuradhapura road project, the solid waste disposal facilities
project, the establishment of Colombo Central Vocational Training
Centre, Gampaha College of Technology and the Ruhunupura water supply
development project.
The Korean government recently provided approximately US$ 70 million
to the Sri Lankan government in the form of grants under KOICA
assistance and loans (EDCF) to achieve balanced and sustainable
development and to assist social integration in line with its national
development programme.
With a recent agreement between the two countries on the Country
Partnership Strategy (CPS), both sides are expected to adopt strategic
approaches in the fields of economic infrastructure development,
education and training and governance. Korea is also involved in
knowledge sharing, people and cultural exchanges with Sri Lanka through
Korea International Cooperation Agency, Korea Trade-Investment Promotion
Agency, Knowledge Sharing Programme, Korea Project on International
Agricultural and HRD Korea. Over 80 KOICA volunteers share their
expertise and knowledge with various government ministries, agencies and
institutes in the fields of medical service, education, culture, rural
development, agriculture vocational training, computer literacy,
environment and Korean language training under the World Friends Korea
programme. |