Export-Import Bank and Africa TDB Shake Hands Beyond Time and Space

First Online Video Contract with Overseas Financial Sector... Signed $100 Million Syndicated Loan Limit
Bank President Bang Moon-kyu: "Establishing Non-Face-to-Face Work... Will Expand Policy Finance Support"

Kang Kyoo Bang, President of the Export-Import Bank (left in the photo), and Admassu Tadesse, President of the Trade and Development Bank (TDB) of East Africa (on the monitor in the photo), are posing for a commemorative photo after signing a $100 million syndicated loan limit agreement through an online video signing ceremony on the 14th.

[Asia Economy Reporter Kangwook Cho] "We ask for more interest from Korea in Africa trade and investment going forward." (Admasu Tadesse, President of the Eastern and Southern African Trade and Development Bank)

"Africa is a market with high growth potential and strategic importance, so we will actively inform domestic financial institutions and companies about this." (Moon Bong-kyu, President of the Export-Import Bank of Korea)

At 5 p.m. on the 14th at the Export-Import Bank headquarters, President Moon, after signing a $100 million syndicated loan limit agreement with the Eastern and Southern African Trade and Development Bank (TDB), responded with these words and reached out his hand for a handshake. President Tadesse also extended his hand, and soon both presidents waved their hands simultaneously. However, their hands were actually 10,000 km apart, and the time in Nairobi, where President Tadesse was located, was 11 a.m.

Typically, contract procedures involve the parties meeting in person to finalize details, sign, and exchange contracts, even for minor matters. However, the two heads of the Export-Import Bank, a policy bank, and TDB, whose members include 22 African countries, concluded a large financial contract worth 120 billion KRW from different locations and time zones. This contract was made in real-time through an online video system. This is the first video contract with an overseas financial institution in the domestic financial sector.

Discussions on the contract between the two financial institutions began at the end of last year. The Export-Import Bank had been preparing the syndicated loan contract through its Tanzania office, but with the global spread of the COVID-19 pandemic earlier this year, they faced difficulties. The working-level staff on both sides negotiated details via phone, messenger, and video conferences since they could not meet in person, but the actual contract signing ceremony seemed distant. Then the idea of a video contract was proposed, and President Moon, judging that the contract could no longer be delayed, actively supported it and ordered thorough preparation. Accordingly, the Export-Import Bank’s Syndicated Loan Office conducted several rehearsals and was fully prepared, and on the day of the contract ceremony, the event proceeded smoothly following the same order as a regular contract ceremony. President Tadesse, who was also experiencing a video contract for the first time, expressed amazement and satisfaction with the smooth conclusion of the contract.

President Moon expects trade and investment between Korea and Africa to surge in the future. Accordingly, he plans to actively utilize the total syndicated loan limit of $700 million set for five African banks, including TDB and the African Export-Import Bank, to meet the demand of Korean companies entering Africa. Syndicated loans are structured such that the Export-Import Bank signs a credit limit agreement with a foreign bank and lends funds, and the local bank then loans to local companies importing Korean goods.

He said, "Last year, Korea’s exports to Africa were $6.3 billion, and overseas investment was $500 million, which is relatively low compared to other global markets, but consultations on transportation and infrastructure sectors have been steadily increasing." He added, "Especially with the full implementation of the African Continental Free Trade Area (AfCFTA), trade and investment by our companies in Africa are expected to increase overall."

Notably, President Moon, who successfully concluded the first video contract with an overseas financial institution in the domestic financial sector, plans to actively establish non-face-to-face work processes. On the 30th, a 'Korea-Africa Syndicated Loan Webinar' will be held. Hosted by the Korean Embassy in Kenya and co-organized by the Export-Import Bank, KOTRA Nairobi Trade Center, and TDB, this event is expected to have about 60 participants, including Korean companies operating in Africa and local importers.

President Moon stated, "In response to the COVID-19 situation, we plan to establish non-face-to-face work processes such as video signing ceremonies and webinars to seek expanded policy financial support."

This content was produced with the assistance of AI translation services.