Korea Commits $24bn to Boost Nigeria, Africa's Growth

President Yoon Suk Yeol 

South Korea's $24bn gift to Africa's growth

The Government of South Korea has pledged $24 billion in development and trade assistance to support African nations, including Nigeria. This commitment aims to strengthen economic ties and promote growth across the continent.

The $24 billion commitment comprises $10 billion for development projects across Africa, focusing on infrastructure, healthcare, education, and other critical sectors. An additional $14 billion is allocated to support the operations of Korean companies in Africa, facilitating trade and investment in host countries.

The 2024 Korea-Africa Summit, held in Seoul, Korea, brought together representatives from 48 African countries, including Nigeria's Foreign Minister, Yusuf Tuggar. The summit aimed to enhance economic cooperation and development between Korea and Africa.

The Joint Declaration, published on the Korean government website on June 5, 2024, outlines the commitment and cooperation between Korea and Africa. The declaration was signed by Heads of State and Government, Heads of Delegation from African countries, the President of the Republic of Korea, representatives from the African Union and its institutions, and a representative from the African Development Bank (AfDB).

President Yoon Suk Yeol of South Korea has emphasized his country's commitment to Africa, stating that their partnership will serve as a model for a secure and sustainable supply chain, fostering mutually beneficial cooperation and contributing to the responsible development of mineral resources globally.

“To facilitate cooperation discussed at this Summit, Korea will continue to expand Official Development Assistance (ODA) up to $10 billion by 2030 as a catalyst for projects for cooperation with Africa, including through the expansion of EDCF Framework Arrangement(F/A) and grants.

“Moreover, approximately $14 billon in export financing will be provided to Korean companies by 2030 to encourage their activities in Africa, thus stimulating trade and investment with Africa.” Yoon Suk-Yeol said.

South Korea has reaffirmed its support for African nations in their bid to secure permanent seats on the United Nations Security Council. This commitment demonstrates Korea's dedication to empowering African countries and promoting global governance.

Building on this pledge, stakeholders have agreed to establish the Korea-Africa Critical Minerals Dialogue, which will be launched during the summit. This initiative will serve as a vital platform for fostering cooperation between Korea and Africa, ensuring a stable supply of critical minerals and facilitating technology collaboration on mutually beneficial terms. The dialogue will provide a structured framework for both parties to work together, driving progress and growth in the critical minerals sector.

“We further recognize the importance of identifying opportunities for Korean companies to invest in Africa and add value to the development of critical mineral resources so that the collaboration may contribute to creating job opportunities and revitalizing local economies.” the joint statement partly reads.

African representatives extended their support to Korea, emphasizing the importance of sustainable peace and stability in achieving the African Union's vision of a united, prosperous, and peaceful continent. This solidarity underscores the shared commitment to fostering a secure and thriving Africa.

Nigeria is well-positioned to benefit significantly from the financial commitments made at the Africa-Korea Summit. According to the Nigerian Bureau of Statistics (NBS), South Korea was Nigeria's seventh-largest import trading partner in the last quarter of the 2023 financial year, with a total trade value of N304.4 billion. Interestingly, mackerel (Scomber scombrus, Scomber australasicus) was among the products imported from Korea, highlighting the diverse range of goods traded between the two nations.

In the fourth quarter of 2023, Nigeria exported unwrought aluminum and alloys to South Korea, valued at N3.4 billion, highlighting the significant trade relations between the two nations.

According to the website of the Embassy of Korea to Nigeria, Korean companies are expanding their presence in Nigeria, with a focus on resource development and construction projects. This growing investment demonstrates the confidence of Korean businesses in Nigeria's economic potential and underscores the strengthening economic ties between the two countries.

“In construction, the total value of orders received by Korean companies reached $15 billion in 2020, which means that Nigeria is by far the biggest construction market to Korea among Sub-Sahara African countries,” the statement partly reads.

President Bola Tinubu in April, recognized the significant presence of South Korean companies and products in Nigeria's market, highlighting the need for enhanced collaboration and cooperation between the two nations to further strengthen their economic ties.