Pact Aims To Stabilize Critical Mineral Supply Chains
Eximbank President Hwang Ki-yeon (left) and ADB President Kanda Masato sign the “Memorandum of Understanding for Critical Mineral Supply Chain Stabilization and Joint Financial Support Platform Development” at the 59th ADB Annual Meeting held in Samarkand, Uzbekistan on May 3.
The Export-Import Bank of Korea (hereinafter “Eximbank”) announced on May 4 that it has signed a financial cooperation memorandum of understanding (hereinafter “MOU”) worth $500 million with the Asian Development Bank (hereinafter “ADB”).
Eximbank President Hwang Ki-yeon and ADB President Kanda Masato signed the MOU on May 3 at the ADB Annual Meeting held in Samarkand, Uzbekistan. The MOU centers on stabilizing critical mineral supply chains and establishing a joint financial support platform.
Through this MOU, the “Supply Chain Stabilization Fund” operated by Eximbank will participate in the “Critical Minerals-to-Manufacturing Financing Partnership Facility” (CMM FPF), a new platform being established by ADB to provide financial support for critical mineral projects in developing countries across the Asia-Pacific region.
Eximbank plans to participate with up to $500 million by 2029, utilizing various financial instruments of the fund, including loans, guarantees, and investments. Based on this, ADB intends to expand the total support scale to $2 billion to $3 billion.
Specifically, the two institutions will consult on a case-by-case basis on: jointly identifying promising critical mineral projects in developing countries; providing co-financing across all stages of the critical mineral value chain, including exploration, mining, refining, smelting, processing, and resource recycling; and structuring blended finance combining loans, guarantees, and technical assistance for high-risk critical mineral projects.
In particular, in accordance with the purpose and objectives of the fund, Eximbank will selectively support projects pursued by ADB that contribute to supply chain stabilization, such as securing equity participation or long-term purchase agreements for Korean companies.
President Hwang stated, “This MOU is the first example in policy finance of jointly supporting critical mineral projects and laying the groundwork for supply chain stabilization in partnership with an international organization that commands high external credibility and strong regional expertise,” and added, “We will seek close collaboration with ADB so that Korean companies can enter developing countries in the Asia-Pacific region — which are rich in critical minerals and rare earths but lack adequate commercialization capabilities in areas such as exploration, mining, and refining and smelting — and connect their presence to the stable establishment of supply chains.”
Yoon Young-sil
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