South Korean Government Provides Export Incentives to Companies Doing Business in Africa
The Republic of Korea has pledged to provide $14 billion in export financing to support South Korean companies investing in Africa while increasing its official development assistance (ODA) to $10 billion by 2030.
On July 2, at the opening of the first Korea-Africa Summit in Seoul, President of Korea Yoon Suk Yeol made this announcement in the presence of 25 African heads of state and government, along with Akinwumi Adesina, the president of the African Development Bank Group.
A total of 48 African countries were represented at the summit by various leaders to engage in discussions themed “The Future We Make Together: Shared Growth, Sustainability, and Solidarity.”
President Yoon Suk Yeol assured that South Korea would extend its Trade and Investment Promotion Frameworks and Investment Protection Agreements to African countries.
African leaders commended Seoul for its inclusive and cooperative approach to enhancing collaboration with the continent, highlighting investment opportunities within their nations and across Africa.
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In his address, President Yoon urged African nations to take decisive actions in an international pressure campaign against North Korea.
Recent aggressive actions by North Korea, including tests of nuclear-capable weapons systems and sending balloons with trash and manure to South Korea, have heightened tensions between the two nations.
Currently, trade with African nations represents less than 2 percent of South Korea’s total imports and exports.
Following the summit on July 2, South Korea and African countries agreed to initiate discussions at a high level to enhance cooperation on mineral resources.
The African continent is a significant source of minerals like nickel, cobalt, graphite, and lithium, essential for industries such as semiconductors, batteries, and electric vehicles—key export sectors for South Korea.
Concerns in South Korea about securing a stable supply of critical minerals have led to plans to expand partnerships in minerals and other natural resources, potentially strengthening the country’s supply chain resilience in technology industries.
Mauritania President Mohamed Ould Ghazouani, the current chairperson of the African Union and a new G20 member, expressed optimism about South Korean investment in various sectors and emphasized the potential for a lasting partnership.
The nations committed to closer collaboration in creating sustainable infrastructure in Africa, including data-driven smart cities and advanced transportation systems, given the continent’s underdeveloped infrastructure.
South Korea’s engagement with Africa occurs as North Korea seeks to break out of diplomatic isolation and foster cooperation with countries opposing the United States, aligning with a potential “new Cold War” stance by North Korean leader Kim Jong Un.
In a joint statement, South Korea and African nations reiterated their support for implementing United Nations Security Council resolutions against North Korea and stressed the importance of international efforts towards complete denuclearization of the Korean Peninsula.
Despite longstanding relations between North Korea and some African nations, like Uganda, Zimbabwe, and Mozambique, certain governments have scaled back ties with Pyongyang due to heightened U.N. sanctions over its nuclear and missile programs.
