Korea Eximbank to loan US$200mn to Sri Lanka for tunnel at rock bottom rate
ECONOMYNEXT – The Export-Import Bank of Korea will provide a $200 million loan to Sri Lanka at 0.15 percent to build a traffic bypass tunnel in the central hill town of Kandy.
A 0.15 percent US dollar interest rate is below American inflation.
The low interest loan will be given from Korea’s Economic Development Cooperation Fund. It will have a 10-year grace period and 40-year payback period.
The Korean embassy said the bypass tunnels will ease congestion in Kandy. It will cut down the transit time from Suduhumpola to Tennekumbura from the current two hours to less than 30 minutes.
It will also reduce air pollution near the historic Temple of the Tooth, the embassy said.
The tunnel will help speed up transport exports from industries in Kandy.