The Republic of Korea and CABEI increases the Korea Development Central American Co-Financing Facility CABEI up to US$600.0 million
To date, five (5) projects have been approved as eligible by the MoEF under the Facility, for a total amount of US$255.7 million.
Seoul, July 11th, 2022. - The Ministry of Economy and Finance (MoEF) of the Republic of Korea through the Economic Development and Cooperation Fund (EDCF) and the Central American Bank for Economic Integration (CABEI) signed today an agreement to increase the availability of financial resources for up to US$600.0 million from the Korea Co-Financing Facility for Central American Development. The objective of the Facility is to co-finance infrastructure projects that contribute to the balanced economic and social development of CABEI member countries.
To date, CABEI and Korea have co-financed five (5) projects for a total of US$863.8 million, of which US$255.7 million comes from this Facility and US$608.1 million from CABEI. The portfolio of projects served under the Facility includes impact initiatives such as: "Sanitation in the city of Bluefields in Nicaragua", "Infrastructure and hospital equipment investment program in Guatemala", "Project for the construction of the viaduct and expansion of the CA01W highway (Los Chorros section) in El Salvador", "Project to expand the potable water supply system in the city of Gracias, Lempira in Honduras" and "Policy-Based Loan (PBL) for the Dominican Republic".
The increase in the Facility will allow CABEI to continue meeting the financing needs of its partner countries with loans from EDCF, a highly concessional resource from Korea. Furthermore, the execution of projects within the framework of this facility allows recipient countries to access the knowledge, experience, technology and expertise of Korean companies.
CABEI Executive President, Dr. Dante Mossi, stated that "With this increase, we will be increasing the flow of resources on concessional terms for financing operations in the region, especially for projects related to electric mobility, transportation, climate change, energy and infrastructure, among others.
The efforts carried out under this Co-Financing Facility are complemented by the activities carried out in the Korea-CABEI Partnership Single Donor Trust Fund (KTF) whose creation agreement was signed on May 19, 2020, allocating resources to the identification and preparation of projects that incorporate content, technologies and best international practices, especially from the Republic of Korea, in relevant areas such as Health, Energy, Social and Productive Infrastructure, Mobility for Cargo and Transportation, Information and Communication Technologies (ICTs) and Climate Change Adaptation and Mitigation, among others.
As a result, to date, within the framework of the KTF, twenty (20) technical cooperations have been granted in the region for a total amount of US$10.5 million. This joint effort will make it possible to develop a pipeline of projects that promote the region's development and that will be eligible for co-financing at competitive financial conditions.
Vice Minister of Economy and Finance of Korea, Mr. Bang Ki-sun, said “We hope that the signing of the Co-Financing Facility Agreement with CABEI will contribute to facilitating various infrastructure projects in priority sectors, such as transportation, water resources, and Information and Communication Technologies, in the Central American region.”
Currently, CABEI has a pipeline that includes eight (8) projects for a total amount of US$2,081.6 million, of which US$927.6 million is expected to be co-financed with resources coming from the Republic of Korea Through the EDCF- CABEI Co-Financing Facility.