The Japan Bank for International Cooperation (Jbic) has signed a ¥1.56bn (US$17.2mn) loan agreement with the Korea Development Bank (KDB) to support the export of equipment for a power plant in Korea.

The loan, provided under the Leading Investment for Future Environment (Life) initiative, was co-financed with Mizuho Corporate Bank and the Bank of Tokyo-Mitsubishi UFJ.

The loan will support the export of key power generation equipment by Mitsubishi Heavy Industries and Mitsubishi Corporation for a by-product gas combined-cycle power plant project. The plant will be constructed by Posco Power, the largest independent power producer (IPP) in Korea, at Gwangyang Works, owned and operated by Posco, its parent company and the largest steel maker in Korea.

Jbic signed a loan agreement for providing a trade finance facility with KDB in September 2009 to stabilise trade between Japan and Korea amid the global financial turmoil. Jbic expressed its intention to support the projects for which Japanese and Korean firms can build win-win relationships.