ID :
29966
Thu, 11/13/2008 - 10:05
Auther :
Shortlink :
https://www.oananews.org//node/29966
The shortlink copeid
Gov't to increase loans to overseas resource projects
SEOUL, Nov. 13 (Yonhap) -- The government plans to increase loans to private
overseas resource development projects in an effort to better insulate South
Korea from sudden fluctuations in global prices, a senior policymaker said
Thursday.
Vice Knowledge Economy Minister Lee Jae-hoon told local executives of resource
development companies that measures are being pursued to increase loans by the
Export-Import Bank of Korea and Korea Export Insurance Corp. in the face of
global financial instability.
The two institutions have set aside around 2.8 trillion won (US$2.0 billion)
worth of funds that can be drawn as loans and loan guarantees this year with the
total to be increased in 2009.
"The global financial crisis, drop in crude oil prices and unstable exchange
rates are all casting shadows on natural resource development efforts, but Seoul
plans to ensure adequate assistance to alleviate such concerns," the official
said.
He added that state-run financial institutions will be asked to increase
so-called success repayable loans to private companies, while a 120 billion won
special fund will be created to further help exploration and development of raw
minerals and energy resources.
A success repayable loan refers to money provided to high-risk, high-return
ventures where the lender receives the principal, interest and extra paybacks if
the investment is successful, but gives up the invested money if the project
fails to produce results.
In the past, the country generally provided such preferential loans only to
state-run companies.
The government has pushed both public and private companies to take greater part
in foreign resource exploration and development to better guard against sudden
spikes in prices. Resource-poor South Korea imports 97 percent of its natural
mineral and fuel requirements from abroad.
Its self-sufficiency in oil and gas stands at around 4.2 percent, while that for
copper is at 2 percent, iron at 12 percent and coal at 38 percent. For other key
resources, such as uranium and nickel, South Korea relies wholly on imports to
meet its domestic needs.
yonngong@yna.co.kr
(END)
overseas resource development projects in an effort to better insulate South
Korea from sudden fluctuations in global prices, a senior policymaker said
Thursday.
Vice Knowledge Economy Minister Lee Jae-hoon told local executives of resource
development companies that measures are being pursued to increase loans by the
Export-Import Bank of Korea and Korea Export Insurance Corp. in the face of
global financial instability.
The two institutions have set aside around 2.8 trillion won (US$2.0 billion)
worth of funds that can be drawn as loans and loan guarantees this year with the
total to be increased in 2009.
"The global financial crisis, drop in crude oil prices and unstable exchange
rates are all casting shadows on natural resource development efforts, but Seoul
plans to ensure adequate assistance to alleviate such concerns," the official
said.
He added that state-run financial institutions will be asked to increase
so-called success repayable loans to private companies, while a 120 billion won
special fund will be created to further help exploration and development of raw
minerals and energy resources.
A success repayable loan refers to money provided to high-risk, high-return
ventures where the lender receives the principal, interest and extra paybacks if
the investment is successful, but gives up the invested money if the project
fails to produce results.
In the past, the country generally provided such preferential loans only to
state-run companies.
The government has pushed both public and private companies to take greater part
in foreign resource exploration and development to better guard against sudden
spikes in prices. Resource-poor South Korea imports 97 percent of its natural
mineral and fuel requirements from abroad.
Its self-sufficiency in oil and gas stands at around 4.2 percent, while that for
copper is at 2 percent, iron at 12 percent and coal at 38 percent. For other key
resources, such as uranium and nickel, South Korea relies wholly on imports to
meet its domestic needs.
yonngong@yna.co.kr
(END)
