Global Infra Fund: created based on public-private partnership investment (as of July 2010, KRW 400 billion), it was designed to provide equity or loans to overseas investment development type projects
ㅇ The GIF feasibility study project aims to provide government funds to cover feasibility study costs at the beginning of each project undertaken by enterprises. Its goal is to support Korean firms' making inroads into markets overseas in investment development type projects (or high value added projects) that usually carry high risks and call for huge initial investment.
ㅇ From the year 2009, this project has provided funds to feasibility studies of 30 cases so far as of 2013 (six in 2009, seven in 2010, three in 2011, five in 2012, and nine in 2013).
- This year is set to provide a total of KRW 2 billion (first phase KRW 646 million, second phase 1.3 billion, with a maximum KRW 500 million for each case). As of now, the first phase has selected three cases and the second phase this time will select three to five applicants.
ㅇ As was in the first phase application round, the government's financial assistance towards Korean firms will be conducted by calling for investment development projects that are in need of financial assistance in either equity or loans forms.
□ The main contents of this GIF contest are as follows:
ㅇ Targets for the fund disbursement are investment development type projects participated by Korean construction companies in the area outside of Korea as project owners in accordance with Korea's Overseas Construction Promotion Act.
The specific areas are: roads, sewerage, railways, water resources, urban development, power generation, and industrial plants. The application should be either for pre-feasibility or feasibility studies.
ㅇ The application will be evaluated by the Overseas Construction Promotion Committee (Chair: Vice Minister for Land, Water and Construction of MOLIT) consisting of governmental officials and private sector experts.
* The Overseas Construction Promotion Committee: Chaired by MOLIT's Vice Minister for Land, Water and Construction, a total of 25 experts who are from relevant ministries, International Contractors Association of Korea, industries, academia, testing institutions, and research institutions are registered as members
ㅇ As a result of the feasibility study funded by the GIF, if a given project shows solid promise, it will be provided with the chance for further advancement; being recommended to various relevant institutions, including the GIF investment management companies (Shinhan BNPP, etc.), policy financial institutions (Korea EximBank, Korea Development Bank, Korea Trade Insurance Corporation, etc.), Middle Eastern sovereign wealth funds, and multilateral development banks (World Bank, Asian Development Bank, etc.), not to mention the Korean government's active support in its ambassadorial role for the project on the global construction stage.
□ An official related to MOLIT commented, "Not only will the utilization of the GIF feasibility study support project help reduce initial project identification costs,"
"It also will help selected companies receive governmental aid through various institutions including policy financial institutions, Middle Eastern sovereign wealth funds, and MDBs, which will prove instrumental in securing further support for their projects."
* The governmental aid in detail: Korea EximBank will provide a one stop financial assistance via equity or loans through the GIF utilizing its own policy finance assistance center in terms of providing feasibility study results.
Global Infrastructure Facility (GIF), would involve institutional investors such as pension funds, donor nations, multilateral development banks
• The move paves way for institutional investors to help fill infrastructure gaps of $1 trillion a year in extra investment needed through 2020
• Work has already started on a pipeline selection process and the GIF is talking to partners and beneficiary countries about several projects with potential
□ Applications for the GIF can be made through the International Contractors Association of Korea (Financial assistance center: , 1023). More detailed information can be gained from the websites of MOLIT (www.molit.go.kr) or ICAK (www.icak.or.kr).
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