Export-Import Bank Expands Ship Financing to 5.2 Trillion Won "Supporting Shipbuilders and Partners"

Visiting Executive Director Bang Moon-gyu Visits Ulsan Shipbuilding Industry Site... Announces Significant Expansion of Ship Financing Support
Support Increased by 1.4 Trillion Won from Initial Plan of 3.8 Trillion Won for Shipbuilders and Small-Medium Partners

On the afternoon of the 26th, Ban Moon-kyu, President of the Export-Import Bank of Korea, visited Hyundai Heavy Industries located in Ulsan to hear about the difficulties faced by the shipbuilding industry due to the impact of COVID-19. From the left in the photo are Ban Moon-kyu, President of the Export-Import Bank, and Han Young-seok, CEO of Hyundai Heavy Industries. Photo by Ban Moon-kyu

[Asia Economy Reporter Jo Gang-wook] The Export-Import Bank of Korea (KEXIM) will increase its ship financing support from 3.8 trillion won to 5.2 trillion won to help the shipbuilding industry overcome the crisis caused by the novel coronavirus disease (COVID-19).

On the 26th, Bank President Bang Moon-kyu visited Hyundai Heavy Industries located in Ulsan and TSP, a ship engine parts manufacturer, consecutively, and then attended the 'Shipbuilding Industry Communication Meeting' where he made this announcement.

The meeting, held at Ulsan City Hall by Ulsan Metropolitan City to listen to the difficulties of the shipbuilding industry and explore support measures, was attended by a total of 10 companies including major shipbuilders and shipbuilding subcontractors in the Ulsan area such as Hyundai Heavy Industries, Hyundai Mipo Dockyard, Shinhan Heavy Industries, Lee Young Industry, Sejin Heavy Industries, Youngkwang Workshop, Terra Tech, Dongyang Sanjeon, Nobel Precision Metal, and Sweik.

At the meeting, Han Young-seok, CEO of Hyundai Heavy Industries, said, "Due to the prolonged slump in orders caused by the COVID-19 pandemic, it is expected to be difficult to secure operating funds," and requested, "We hope that shipbuilding financing will be expanded so that production financing for shipbuilding and domestic and international shipping companies can increase ship orders to our shipbuilders."

Choi Yang-hwan, CEO of Sejin Heavy Industries, said, "We hope that large shipbuilders and financial institutions will take special interest in securing work and resolving financing difficulties for small and medium-sized subcontractors."

In response, President Bang said, "KEXIM has increased its funding plan for shipbuilders this year from the original 3.8 trillion won by 1.4 trillion won to 5.2 trillion won to overcome the crisis caused by COVID-19," adding, "After COVID-19, KEXIM will mobilize all its capabilities to help the shipbuilding industry strengthen its global market position and overcome the crisis."

In particular, KEXIM plans to expand the win-win cooperation loan from 1.6 trillion won to 1.9 trillion won in cooperation with shipbuilders so that this fund supplied to shipbuilders will be primarily used as payment funds for deliveries to small and medium-sized subcontractors. Through the win-win cooperation loan, when KEXIM supplies funds to shipbuilders, the shipbuilders use these funds as payment for progress payments or material deliveries to small and medium-sized subcontractors.

Since February, KEXIM has been implementing a COVID-19 financial support program that includes extending existing loan maturities and providing new operating funds to small and medium-sized equipment suppliers.