SEOUL – South Korea has formalized an agreement to provide Ukraine with economic cooperation funds, which includes $2.1 billion in low-interest loans to aid the war-affected nation's recovery, the Ministry of Economy and Finance announced Sunday.
According to Yonhap News Agency, South Korean Finance Minister Choi Sang-mok and his Ukrainian counterpart, Sergii Marchenko, signed the framework agreement on Friday in Washington, D.C. This agreement is part of Seoul's broader commitment made last year to support Ukraine with a total of $2.3 billion, where the initial $200 million will be disbursed as humanitarian aid this year to meet emergency needs in Ukraine. The remaining funds will be offered as long-term, low-interest loans starting in 2025 through the Economic Development Cooperation Fund (EDCF). "Friday's arrangement was meant to lay the legal foundation on credit assistance. The two sides agreed to explore projects together that help Ukraine's reconstruction and development," the ministry stated.
During his visit, Choi also participated in committee meetings of the World Bank and the International Monetary Fund (IMF). He advocated for the expansion of the World Bank's co-financing platforms in partnership with private entities to transform the institution into a "better and bigger bank." Additionally, Choi proposed hosting the International Development Association's (IDA) next replenishment meeting in South Korea in December. The IDA, a branch of the World Bank, provides grants and loans to the world's poorest countries.
In a separate engagement, Choi signed a $55.96 million grant agreement with IMF Managing Director Kristalina Georgieva for the Poverty Reduction and Growth Trust (PRGT) program, which offers zero-interest loans primarily to low-income African nations. South Korea has pledged support for this program through 2027.
Choi's schedule also included a meeting with Roberto Sifon-Arevalo, the managing director of sovereign ratings at Standard & Poor's Global Ratings, to discuss South Korea's economic situation and policies aimed at fostering growth, ensuring financial stability, and attracting foreign investment. His visit to Washington was part of his participation in the G20 finance ministers' meeting and the inaugural trilateral talks with his counterparts from the United States and Japan.