On Nov. 26, representatives from Korea Eximbank embarked on a trip to the Middle East to visit six* major local banks in the UAE, Kuwait, and Qatar and conclude MOUs for mutual financing support of projects participated by Korean companies.

* National Bank of Abu Dhabi, National Bank of Kuwait, Al Ahli Bank of Kuwait, Commercial Bank of Kuwait, Qatar National Bank, and Qatar Islamic Bank

The Middle East is a key plant market for Korea as the region accounts for 66% of annual plant contracts won by Korean companies.

* EPC (Engineering, Procurement, Construction): contracts encompassing the entire construction process from engineering, procurement of materials, and construction, to trial operation.

Since 2005, Korea Eximbank and financial institutions in the Middle Eastern region have provided a total of USD 11.35 billion for 14 projects such as oil refining and power generation, desalination plant projects in the Middle East.

Conclusion of the MOUs was spurred by the fact that utilization of local funds is critical for successful financing of increasingly large-scale projects in the Middle East, especially as European banks have diminished financing capacities in the wake of the global financial crisis.

After a comprehensive marketing campaign for project procurement targeting major contracting companies in the Middle East last September, the focus this time was on increased utilization of funds in the Middle East through cooperation with local financial institutions, a representative from Korea Eximbank explained.

Executive Director Ki-Sub Nam stated, “As part of our efforts to actively prepare for the increasing trend of “financing before contracts” in the Middle Eastern plant market, we have concluded MOUs for joint cooperation with major banks in the Middle East. Through close cooperation with these financial institutions, we will enhance project information exchange, mutual financing support, and financing in Middle Eastern currency to support Korean companies.”

Korea Eximbank plans to collaborate actively with eight major international commercial banks, including ING and HSBC, and ten financial institutions in four Middle Eastern countries for greater participation of these institutions in overseas projects promoted by Korean companies.