Ando Geol: "Korea Has Not Received 280 Billion Won in Russia Economic Cooperation Loans"

Russia's Delayed Repayment Since Ukraine Invasion
Government "Requesting Remittance Through Diplomatic Letters, etc."

Ando-geol Assemblyman

It has been confirmed that South Korea has not been able to recover the economic cooperation loan worth 280 billion won (210 million dollars) lent to Russia.

According to the National Assembly audit data submitted by Ahn Do-geol, a member of the Democratic Party of Korea (Gwangju Dongnam-eul), from the Ministry of Economy and Finance and the Export-Import Bank of Korea on the 21st, the Roh Tae-woo administration in 1991 provided a total loan of 1.47 billion dollars to Russia as part of the Northern Policy's "Bulgom Project," but repayments have been delayed multiple times and have yet to be received.

The South Korean and Russian governments agreed on debt restructuring in 2003 to repay 1.58 billion dollars. However, the repayment of approximately 280 billion won still outstanding has been delayed since June last year.

Originally, Russia was to repay all principal by December next year, with payments scheduled twice a year on June 1 and December 1, consisting of 35 million dollars in principal plus interest calculated at LIBOR (London Interbank Offered Rate) plus 0.5 percentage points.

However, due to Russia's recent invasion of Ukraine and the resulting strengthening of international sanctions, dollar remittances have become difficult, causing about 160 billion won (120 million dollars) in principal and interest payments due in the first and second halves of last year and the first half of this year to be overdue, and repayments are currently delayed.

Regarding this, the government stated, as relayed by Representative Ahn, that "we are requesting remittance through diplomatic letters and working-level consultations with the Russian side and will continue to negotiate through diplomatic channels."

Representative Ahn urged, "As the Russia-Ukraine war prolongs and international sanctions are likely to intensify further, resolving the repayment issue does not seem easy," adding, "More active and concrete measures should be prepared to recover the loan."