POSCO Holdings' Argentina brine-lithium production unit, POSCO Argentina, secured a $700 million (about 1 trillion won) operating capital credit line from the Inter-American Development Bank Group (IDB Group).
POSCO Holdings said on the 28th that POSCO Argentina received approval on the 4th for a total $700 million short-term credit line from IDB Invest, the private-sector investment arm of the IDB Group.
Under its "Latin America and the Caribbean critical minerals supply chain support strategy," the IDB Group is providing financial support for in-region resource development projects. In the approval process, the IDB gave high marks to POSCO Argentina's lithium project for meeting global ESG standards and contributing to economic development in Latin America and the Caribbean.
With this approval, POSCO Argentina can secure working capital for Brine Lithium Plant 1 and Plant 2, which is scheduled for completion in the second half of this year, as needed.
Tax benefits under the IDB's establishing agreement also apply. The company said tax preferences, including on financial transaction taxes arising from interest and the borrowing process, will reduce financing costs. POSCO Holdings expects that large-scale, low-interest working capital procurement and tax benefits will help strengthen business profitability and competitiveness.
POSCO Holdings assessed the Argentina government's approval of the large-scale investment promotion regime (RIGI), achieved at the Korea-Argentina summit on the 31st, and the IDB's approval of a large credit line as examples where public-private cooperation produced results in Argentina's lithium business and the critical resource supply chain.
POSCO Argentina turned a quarterly profit for the first time in the second quarter of this year. POSCO Holdings expects that strong revenue, coupled with public-private cooperation with the Korean government, institutional support from the Argentina government, and fundraising through international financial institutions, will accelerate the local lithium business.
POSCO Holdings plans to strengthen its "Triple-core" growth strategy, under which steel is an industrial resource; lithium, cathode materials, anode materials, rare earths, and rare gases are strategic resources; and liquefied natural gas (LNG) and renewable energy are energy resources. The company also plans to continuously reinforce supply chains for critical resources, including lithium.