Tuesday, 28 March, 2023

Bangladesh, S Korea sign $3bn loan deals for mega projects

  • Staff Correspondent
  • 14 March, 2023 12:00 AM
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Bangladesh and South Korea have signed two agreements for over $3 billion loan for implementing mega projects in Bangladesh during the 2023-2027 period.

Under the Letter of Understanding (LoU) and Cooperation Arrangement (C/A), South Korea will provide $3 billion as a soft loan through the Economic Development Promotion Facility (EDPF).

Sharifa Khan, secretary of the Economic Relations Division, and Seong-wook Kim, deputy minister for International Affairs, the Ministry of Economy and Finance of South Korea, signed the agreements on behalf of their respective countries on Sunday, said a release.

At the same time, Md Shahriar Kader Siddiky, additional secretary of the Economic Relations Division and Tae-soo Kim, executive director of South Korea Exim Bank, also signed the financial cooperation agreement.

The interest rate of the loan agreement of each project will be 1 percent with a 30-year repayment period, including a seven-year grace period.

The management fee would be 0.4 percent, and contractors will be appointed through international bidding.

South Korea has been providing soft loans through their development partner South Korea Exim Bank for the development of socio-economic, infrastructure and ICT sectors in Bangladesh since 1993.

So far, 16 projects worth $619.78 million have been completed with South Korea's assistance and seven more worth $616.28 million are ongoing.

The South Korean government has committed to providing Bangladesh with a total of $1.31 billion through soft loans, which is the second largest amount among its development partner countries.