Visiting Koo Bon-gyu, KDB President, Achieves $5 Billion in Results on First Overseas Tour

Signed Financial Agreement with UAE Abu Dhabi National Energy Company
Expecting Expansion of Domestic Companies' Middle East Construction Orders
Plans to Promote Cooperation with Saudi Arabia, Qatar, and Others

[Asia Economy Reporter Kim Jin-ho] Bang Moon-kyu, President of the Export-Import Bank of Korea (KEXIM), is gaining attention for remarkable achievements during his first overseas trip since taking office. At his first overseas stop in the United Arab Emirates (UAE), he signed a $5 billion “financial agreement” with the giant state-owned company Abu Dhabi National Oil Company (ADNOC). It is considered unusual to conclude a direct credit line agreement with the client, rather than the usual project-based support method used by KEXIM. This agreement is seen as significantly increasing the possibility for Korean companies to secure large-scale projects in the Middle East.

According to KEXIM on the 22nd, President Bang met with Sultan Ahmad Jaber, Chairman of ADNOC, at ADNOC headquarters in the UAE on the 20th (local time) and signed a “medium- to long-term financial credit line agreement” worth 5.6 trillion won. This medium- to long-term credit line agreement means that KEXIM preemptively sets the credit limit and support conditions for financing to major clients, enabling rapid financial support when future transactions such as contract awards to Korean companies occur.

As a public export credit agency (ECA), KEXIM has so far supported companies through direct loans or guarantees for individual overseas construction projects. However, during this UAE visit, it signed a credit line agreement directly with the client. From the perspective of domestic companies, this is evaluated as a case that greatly increases the possibility of winning large projects such as plants or infrastructure businesses.

This outcome reflects President Bang’s strong determination to fully support Korean companies. His strategy is to benchmark the “pre-financing and post-contract award” trend in the overseas plant market to gain a superior position over foreign competitors in bidding competitions.

In addition to the $5 billion financial agreement, President Bang included provisions in the agreement that KEXIM will provide financing if Korean companies win large projects to be ordered by ADNOC within this year. These projects include an offshore power supply submarine transmission network for offshore oil production facilities (total project cost $3.1 billion) and the construction of petrochemical (polyethylene) production facilities (total project cost $6 billion).

President Bang’s visit to the UAE was made possible thanks to COVID-19 vaccinations. Since taking office on November 1, 2019, he had not undertaken any overseas trips for one and a half years due to the COVID-19 pandemic. However, this trip is expected to accelerate President Bang’s global management activities.

KEXIM plans to seek strengthened cooperation with major Middle Eastern energy state-owned enterprises such as Saudi Arabia’s state oil company Aramco and Qatar’s state oil company. As the low oil price situation caused by COVID-19 comes to an end, Middle Eastern countries are launching large-scale projects one after another, and KEXIM’s strong determination to proactively support Korean companies’ contract awards on all fronts is interpreted as a leading effort.

Meanwhile, President Bang also plans to further strengthen domestic field management activities to actively support the export competitiveness of small and medium-sized enterprises (SMEs) and mid-sized companies and their entry into global markets. Since taking office, he has conducted field management activities to help companies struggling due to COVID-19 and to support entry into new industries. He has visited frontline sites a total of 10 times since his inauguration.

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