South Korea to increase aid to Africa

South Korea will increase aid to African nations.

Korea will focus three-quarters of its bilateral international aid allotment to Asia and Africa, the Prime Minister’s Office said yesterday.

The Prime Minister’s Office, which announced new guidelines covering the country’s official development assistance, said Asia will receive 55 percent of funds set aside for bilateral aid, while Africa will receive 20 percent. The remaining funds will be allocated to Latin America, the Middle East and former Soviet states, among other places, it said.

The plan will go into effect next year and remain in place until 2015. A detailed plan will be drafted within the year.

This is the first time the country has established ODA guidelines by region.

Thus far, Korea has provided development assistance through multiple state agencies including the Ministry of Foreign Affairs and Trade and the Ministry of Strategy and Finance, which critics say has resulted in inefficiencies.

To address the problem, the government put the Prime Minister’s Office in control of the aid program in January.

“Providing practical support to developing countries and doing so with modesty is more important than anything else [in the ODA program],” Prime Minister Kim Hwang-sik said. “The new guideline will ensure that Korea becomes an exemplary contributing country.”

Korea quadrupled its foreign aid contribution from $212.1 million in 2000 to $816 million last year. Its ODA-to-Gross National Income ratio was 0.10 percent last year, and the government expects that to rise to 0.13 percent this year.

The new guideline requires that the government’s bilateral aid allotment be kept at 70 percent of the ODA total.

Until now, Korea has focused its multinational aid program on loans through organizations such as the World Bank, but it will now increase its contribution through international organizations such as the UN, the Prime Minister’s Office said.

Given the amount of resources that China needs and its assistance to nations across the continent, I’m not surprised that South Korea is following in the same foot steps.  Korea needs to find new markets for its products just like China.

“Africa is increasingly important for us not only in broadening our diplomatic horizon, but also in securing energy resources,” a Seoul government official said on condition of anonymity citing department policy.

South Korea’s leading Chosun Ilbo newspaper also quoted an unidentified official as saying, “Africa is considered the world’s last-remaining growth engine due not only to its energy resources but also to its potential to become a giant market.”

Trade between South Korea and African countries amounted to $13.43 billion in 2008, with Seoul’s exports rising 13.7 percent to $9.38 billion from the year earlier, according to Korea International Trade Association figures. Through October this year, however, South Korea’s exports to Africa fell about 20 percent compared to the same period last year as the country’s overall exports suffered amid the global economic crisis

We all know that nothing talks better than money and this will certainly raise Korean influence where ever Seoul decides to try and exercise some influence for its interest. Better late than never.

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