Financial cooperation between Korea and Russia is set to increase, including cooperation in developing the Russian Far East.

The Export-Import Bank of Korea (www.koreaexim.go.kr, Chairman Kim Yong-hwan, “Korea Eximbank”) announced on November 14 that the bank signed a Memorandum of Understanding (MOU) for the establishment of a Korean-Russian Co-investment Platform ？ aimed especially at promoting the development of the Russian Far East - with Russia’s state-owned Bank for Development and Foreign Economic Affairs (VEB), at the presidential Blue House in the presence of the heads of state of the two countries.

The ‘Korean-Russian Co-investment Platform’ is an arrangement for cooperation between Korea Eximbank and VEB structured to financially support Korean companies investing or participating in projects identified jointly by the two institutions.

The MOU includes an agreement to work toward jointly identifying large-scale development projects in sectors including energy, petrochemical plants, natural resources, transportation, shipbuilding, environment, and alternative energy in Russia, especially in the Far East and Eastern Siberia.

The two agencies would provide equity investments and financing for projects involving companies from both countries with a combined amount of up to USD 1 billion.

By establishing a substantive framework of cooperation between the two principal financial policy arms of the Korean and Russian governments, the MOU is expected to boost opportunities for Korean companies to participate in Russia’s USD 359 billion long-term plan to develop the Far East.

Although rich in natural resources such as oil, gas, coal, and timber, Eastern Siberia remains underdeveloped due to its poor infrastructure base ？ an area which is likely to draw in continued investment.

In order to attract the necessary foreign investment, Russia has joined the WTO last year and created a ministry devoted to the development of the Far East.

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