Korea’s Seoul-based Industrial Bank is in talks with the Russian government to develop a joint $1 billion infrastructure fund covering a variety of segments in remote areas neighboring the two countries, announced Russian Deputy Prime Minister Yury Trutnev, on the sidelines of a Russian-Korean business forum last week, according to Russian news agency TASS.
The enterprise largely echoes the Russian-Korean Siberian infrastructure fund which was launched in November last year by the Russian Direct Investment Fund and the Korean Investment Bank, similarly funded with $1 billion in Korean investment but with a primary focus on natural resources transport.
“We are willing to co-operate in shipbuilding, the energy sector, infrastructure development, wood and mineral processing. Apart from mineral resources, our country is interested in collaborating in the high technologies industry,” said Trutnev.
Last year’s fund launch was followed by the signing of a memorandum of understanding between Seoul and Moscow to provide hydrocarbon transportation across the Northern Sea Route, with an agreement to contract out to Korean shipbuilders the construction of 13 liquefied natural gas carriers.
The Korean government has announced a four percent year-on-year increase in infrastructure spending in its 2015 budget, and the expansion of Incheon International Airport, coupled with a restart of nuclear power generation plans, could bring tailwinds to more infrastructure fund involvement in the year to come.