Exclusive: South Korea plans first US investment transfer this month and Westinghouse stake purchase

South Korea plans to send its first major payment for investment in the United States at the end of this month, 11 months after the two countries reached a tariff agreement. The initial transfer is expected to total at least $2.2 billion, or about 2.96 trillion won.

The government plans to announce its investment project strategy on September 18 and send the first funds on September 29 or 30. The United States has pressed South Korea to announce and execute the investments more quickly. Seoul intends to use foreign-exchange assets entrusted to the Bank of Korea and the Foreign Exchange Stabilization Fund. If those resources fall short, it plans to raise government-guaranteed bonds and borrow from overseas financial institutions.

The initial funding forms part of a broader commitment set out in a joint fact sheet agreed by the two countries last October. South Korea agreed to make $200 billion in cash investments in the United States over 10 years, with annual spending capped at $20 billion. This year, the government plans to secure funding for initial projects. From next year, investment is expected to proceed within the annual limit.

The investment fund's destinations have narrowed to three major projects: the $22.3 billion first project, a gas-fired combined-cycle power plant in Encinal, Texas; a $120 billion nuclear project framework for building eight reactors in the United States; and the $67 billion Alaska LNG project. Their combined value is $209.3 billion, exceeding the previously agreed $200 billion cash investment target.

On nuclear cooperation, the government is preparing a framework involving Korea Electric Power Corp., Korea Hydro & Nuclear Power Co. and Westinghouse. The framework is also reported to include a possible South Korean purchase of part of Westinghouse. A ruling-party official said the government was pursuing voting common shares, while the amount and voting rights remain under discussion.

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The government is pursuing the acquisition of voting common shares, but the amount to be acquired and whether voting rights will be granted are still under discussion.