Export-Import Bank Expands Financial Support to 69 Trillion Won This Year, Leading Overseas Expansion Assistance (Comprehensive)

Bank President Bang Moon-kyu, First Meeting Since Inauguration: "We Will Lead as a Financial Institution Driving Financial Innovation"

Visiting Kyu Bang, President of the Export-Import Bank, is attending the New Year's press conference held at the Bankers Association in Myeongdong, Seoul on the 20th, explaining the bank's major business plans for this year.

[Asia Economy Reporter Cho Kang-wook] The Export-Import Bank of Korea (KEXIM) will expand its total loan support to 69.3 trillion KRW this year to boost economic vitality. This is an increase of 9.5 trillion KRW compared to last year's performance. In particular, support for the New Southern Policy will also increase to 10 billion USD to expand overseas orders.

On the 20th, Bank President Bang Moon-kyu held a New Year press briefing at the Bankers Club of the Korea Federation of Banks in Myeong-dong, Seoul, where he announced the '2020 Major Business Promotion Plan' including these details.

This year, KEXIM plans to focus support on 68.6 trillion KRW, including 28.1 trillion KRW for small and medium-sized enterprises (SMEs) and mid-sized companies, 20 trillion KRW for materials, parts, and equipment, 12 trillion KRW for overseas infrastructure, and 8.5 trillion KRW for innovative growth. KEXIM explained that this is to accelerate the innovation engine of the economy and enhance global competitiveness by strengthening support for innovative growth, materials-parts-equipment, SMEs and mid-sized companies, and order industries.

Looking in detail at the key support areas, to drive a rebound in overseas orders, KEXIM will strengthen business development in core strategic countries under the New Southern and New Northern policies. The core strategic countries selected by KEXIM this year are 10 countries including Indonesia, Vietnam, India, Russia, Uzbekistan, and Myanmar. Among these, support for the New Southern Policy will increase from 8.6 billion USD last year to 10 billion USD this year. KEXIM plans to provide customized financial products using export finance and Official Development Assistance (ODA), and introduce region-specific products such as local currency loans and guarantees, and mid- to long-term factoring.

President Bang said, "We will focus on supporting large-scale project orders such as the relocation of Indonesia’s capital," adding, "We will strengthen support for 'high value-added investment and development type' project orders that can leverage the strengths of our companies, moving away from simple contract-type project orders."

Additionally, support for overseas infrastructure orders will increase by 41%, from 8.5 trillion KRW last year to 12 trillion KRW this year. KEXIM will strengthen support to secure orders for high value-added investment and development type projects by our companies, moving away from simple contract-type project orders. It will also discover projects where our companies can participate, focusing on new development industries such as smart cities, airports, and ports, and provide business and financial advisory services.

To accelerate innovative growth, support for materials, parts, and equipment will increase from 19 trillion KRW last year to 20 trillion KRW this year, and support for key innovative industries such as secondary batteries, displays, semiconductors, 5G communication equipment, and eco-friendly ships will expand from 6.9 trillion KRW last year to 7.5 trillion KRW this year. Support for three new industries?system semiconductors, bio-health, and future automobiles?will also increase from 880 billion KRW to 1 trillion KRW.

To foster global SMEs and mid-sized companies, KEXIM will continue to expand the base of policy finance beneficiaries. Funding supply will increase from 26.8 trillion KRW last year to 28.1 trillion KRW, and the number of client companies will expand from 4,555 to 5,200. By sector, support for the Hidden Champion nurturing program will increase from 7.4 trillion KRW to 8 trillion KRW. Customized financial support for 234 target companies, interest rate reductions of up to 0.5 percentage points, and benefits such as 100% recognition of export performance will strengthen nurturing functions. Support for win-win finance programs will expand from 2.9 trillion KRW to 3.5 trillion KRW, and support for securing core technologies will increase by 200 billion KRW to 5.5 trillion KRW.

To achieve innovative economic cooperation results, the Economic Development Cooperation Fund (EDCF) will increase by 13%, from 1.0518 trillion KRW to 1.185 trillion KRW. Furthermore, to establish a comprehensive support base for inter-Korean economic cooperation, the main project budget of the Inter-Korean Cooperation Fund will also increase from 1.1 trillion KRW to 1.2 trillion KRW.

Moreover, KEXIM plans to focus on completing the restructuring of shipbuilding companies such as Daewoo Shipbuilding & Marine Engineering (major national corporate merger notification completed), Sungdong Shipbuilding (pursuing conclusion of rehabilitation procedures), and Daesun Shipbuilding (pursuing mergers and acquisitions).

Regarding the recent failure to introduce the 'Labor Director System,' President Bang explained, "During the nomination process for outside directors, candidates recommended by the labor union were also included and evaluated based on the same criteria such as achievement of duties, contribution, suitability, and expertise," adding, "However, the final selected candidate did not include the labor union’s recommended director after reflecting the opinions of various participants."

He added that there was an internal judgment that a female expert was needed in this appointment process. President Bang said, "Following the amendment of the Capital Market Act at the end of last year, financial institutions above a certain scale are required to appoint at least one female director. We expect this policy change to also impact public institution management, so there was an internal judgment that it would be better to include a female financial expert in the appointment process of outside directors at the Export-Import Bank."

Now about 100 days into his tenure, President Bang shared his reflections and future plans, saying, "I hope the Export-Import Bank will become a financial institution that leads financial innovation and drives industrial innovation," emphasizing, "As a competitive policy fund provider, we will take the lead at the forefront and collaborate with other public institutions and financial institutions to discover large-scale projects."