The Export-Import Bank of Korea is making strides to expand its network with financial institutions based in Latin America to clear the path for South Korean companies to enter emerging markets in the region.
Eximbank Chairman Yoon Hee-sung attended the 2023 Annual Meeting held by the Inter-American Development Bank in Panama from March 16 to 19. At the event, he signed a Confirming Bank Agreement with James Scriven, CEO of IDB Invest -- the private sector arm of IDB Group -- to solidify Eximbank’s new role as a confirming bank in the Trade Finance Facilitation Program, or TFFP.
“Our agreement with IDB Invest and willingness to provide financial support for business projects in Latin America will boost our competitiveness in the global financial domain,” Yoon said in a statement.
Under the TFFP, IDB Invest provides technical cooperation and financial products which aim to open up access to international trade finance markets for Latin American and Caribbean banks, according to the firm. As a new confirming bank in the program, the Korean state-run policy lender will be able to provide indirect export-related loans to local companies importing Korean products through 96 banks across 21 Latin American countries.
On the other hand, IDB Invest will extend guarantees to cover various financial instruments used in international trade transactions such as bills of exchange and advance payment bonds.
Both Yoon and Scriven described the agreement as a milestone in reinforcing trade and financial cooperation between Korea and Latin America.
During his trip, Yoon also met with several figures in the financial sphere to lay out a more detailed plan for Korea’s venture into the region, where infrastructure projects are having difficulty securing funds due to unstable conditions such as the continued fiscal crisis in Europe and delayed economic recovery in advanced countries.
This includes IDB President Ilan Goldfajn and finance ministers of various countries including Alejandro Zelaya of El Salvador and Sergio Cusicanqui of Bolivia, with whom he discussed ways for Korean companies to enter the energy and climate change sectors in Latin America to contribute to industrial decarbonization there.