South Korea’s state-run Korea Development Bank (KDB) said on Thursday it will form an investment consortium with several domestic institutional investors to inject 150 billion won ($130 million) into a Chinese project for the expansion of the Haikou Meilan International Airport, which is a part of China`s massive "One Belt, One Road" infrastructure drive.

The investment, if realized, will mark the first case where Korean investors join the infrastructure project that aims to increase China’s economic clout in Asia.

Other consortium members include KDB Capital, Saemaul Bank and Kyowon Investment. The consortium will channel 100 billion won to a private equity fund to be led by KDB, while KDB’s Guangzhou branch will add 50 billion won in the form of lending to the project. The expected portfolio annual return is 7 percent or so.

Haikou Meilan International Airport located 25 km southeast of Haikou, the capital of the southern island province of Hainan opened in May 1999 and hosts airliners serving 168 regular routes stretching over 83 cities. Of these, 157 routes are for domestic-bound flights, raising the need for airport expansion.

China Hainan Group, the majority shareholder of the airport, will pay a total of 16.2 billion yuan in total capex, plus the central government and Hainan provincial government subsidies and the investment from Korea.

The airport expansion will be completed in October 2019. The new terminal will have a floor area of 296,000 square meters and will have a new four-story terminal building and one runway.

By Kang Doo-soon and Han Woo-ram

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