The Export-Import Bank of Korea (Kexim) has agreed to open a credit line of US$100mn to African Export-Import Bank (Afreximbank), aimed at boosting Korea-Africa trade.

Kexim president Lee Duk-Hoon and Afreximbank president Benedict Oramah have signed a memorandum of understanding (MoU), in which Kexim commits to issuing a credit line of US$100mn to support trade transactions between South Korea and Africa. The two institutions will also “explore the possibility of establishing other financing schemes” for the same purpose, Afreximbank says in a statement.

The credit facility itself has not been sealed yet, and the details of the loan are still to be finalised, an Afreximbank spokesperson tells GTR, but negotiations will be set up as a result of the MoU.

Speaking at the signing ceremony last week, Oramah described the credit line as “very timely” as it could finance the import of investment goods to accelerate the structural transformation of African countries. “We look forward to using the funding to pursue the urgent needs of our continent,” he said.

Lee stressed the need for the two institutions to deepen their collaboration in order to boost trade and investment between South Korea and Africa.

The MoU comes at a time when trade between the African continent and South Korea is in decline. In 2015, Africa’s imports from South Korea were valued at US$9.8bn, a decrease from US$13bn in 2014. South Korea’s imports from Africa stood at US$5.8bn in 2015, down from US$7.9bn in 2014.