IFC and Korean company to develop hydropower in Laos
International Finance Corporation (IFC), a member of the World Bank Group and Korea Western Power Co., Ltd, have jointly agreed to develop sustainable hydropower in Laos.
Korea Western Power Co., Ltd, is a wholly owned subsidiary of Korea Electric Power Corporation. The agreement, signed in Vientiane last month, enables IFC to act as Korean Western Power's co-developer of one or more new hydropower projects in the Lao PDR, with a total capacity of up to 150 megawatts.
This cooperation agreement will contribute to the government's goal of providing electricity to 90 percent of households by 2020, according to the corporation.
IFC Vice President for Asia Pacific Karin Finkelston and Korea Western Power CEO Moon Duk Kim met in Seoul yesterday to acknowledge the agreement and kick off the partnership.
“We look forward to working with KOWEPO to develop a successful hydropower business model that pioneers new social and environmental standards in the Lao PDR, and further promotes the country's sustainable economic development,” Finkelston said. Under the agreement, Korea Western Power will lead the overall project development as the main sponsor.
IFC InfraVentures will support the project by assisting with financial structuring, as well managing environmental and social impacts. In addition, IFC InfraVentures will raise capital for the projects from other developmental financial institutions and commercial banks.
The partnership with Korea Western Power represents IFC's first private sector investment in the Lao hydropower sector.
It is part of IFC's comprehensive energy strategy that includes investment in hydropower projects, which will supply electricity to use either domestically, or as a commodity to be sold to neighbouring countries. It's combined with an advisory programme that will implement global environmental and social standards on its hydropower projects.
IFC's presence in Laos spans over a decade. The corporation provides loans, equity investments and advice to help the private sector become a key engine for sustainable economic growth, job creation, raising incomes, and reducing poverty.
The IFC promotes inclusive growth through improved access to services and infrastructure in the Lao PDR, and makes it easier to do business to support the country's transition into a market-driven economy.