The Import-Export Bank of Korea signed a $ 200 million loan agreement with the Development Bank of Latin America to facilitate Korean exports, the bank said on Tuesday.

Under this bank-to-bank arrangement, companies that import Korean products to the region can borrow funds from the Latin American Development Bank (CAF) to cover transactions, investments and operational costs.

A total of 19 countries, including Peru, Colombia and Brazil, are members of the development bank.

“Central America has enormous growth potential due to its abundant mineral resources, over 600 million people and a relatively young population,” said Bang Moon-kyu, president and chairman of Export -Import Bank of Korea.

“We hope this can improve the competitiveness of Korean companies in exporting infrastructure, automobiles and medical products to the Central American region.”

Trade and investment between the two countries are growing steadily, according to data from the bank. Korea exported $ 26.3 billion worth of goods to Central America last year. Investments amounted to $ 10.2 billion in 2019.

Transactions between the two countries are expected to increase in the future, following the bilateral trade agreement between Korea and Central American countries, which entered into force in October last year.

Korea’s foreign ministry is in talks for an FTA with several trade blocs in the region, such as Mercosur – Brazil, Argentina, Paraguay and Uruguay.

“We will use the loans from Korea to improve the infrastructure of Central American countries and the competitiveness of member countries,” said Luis Carranza, executive chairman and CEO of CAF.

BY KANG JAE-EUN [[email protected]]