The government is expanding financial support to developing countries, with its goal of becoming one of the world’s top 10 donors of official development assistance (ODA) before the end of President Yoon Suk Yeol’s term.
A main source of financing for international development assistance, ODA is government aid designed to promote the economic well-being and welfare of developing countries.
The areas of the country’s support range from the fight against climate change to the energy transition, agricultural transformation, education, digital technology and knowledge sharing
Such support is being made in partnership with international organizations, such as the United Nations (U.N.) as well as Korea’s decade-long foreign assistance programs such as the Economic Development Cooperation Fund (EDCF).
The government’s latest commitment was made Tuesday when Deputy Finance Minister Choi Ji-young announced $7 million in contributions during a board meeting of the Fund for Responding to Loss and Damage in Incheon’s Sondgo business district.
Launched by the U.N. Climate Change Conference of the Parties in 2023, the fund is dedicated to helping developing countries that are particularly vulnerable to the adverse effects of climate change.
Announced last week, the Dynamic Korea Roadmap, a comprehensive set of the government’s long-term policy goals, outlined a plan to launch the so-called K-Finance Package in the second half of this year.
The package looks to offer diversified assistance by capitalizing on the Economic Development Cooperation Fund (EDCF) and other funds for supply chains and export financing.
Formed in 1987, the EDCF is aimed at offering low-interest loans for developing countries and strengthening economic cooperation between them and Korea.
During the Asian Development Bank’s (ADB) annual meeting in Georgia in May, Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok 커뮤니티 signed a memorandum of understanding with ADB President Masatsugu Asakawa on earmarking $2 billion in co-financing for ADB projects over next three years.
The projects include transportation, energy, agriculture, education, governance reform, health, and information and communication technology.
In the 2023 joint declaration of the Korea-Africa Economic Cooperation Ministerial Conference in Busan, the government promised to provide a $6 billion package.
It includes $1.5 billion worth of low-interest loans from the EDCF and $4.3 billion worth of export financing from the Export-Import Bank of Korea.
The declaration was made in line with the need of African countries to boost their respective transitions to green energy and adopt technology-driven agricultural development.
Plus, Korea and the African countries agreed on enhanced cooperation for knowledge sharing and capacity building.
The Yoon administration came up with its goal to leap into the top 10 ODA contributors worldwide in 2022.