Firms expand business in Vietnam after Lee`s visit

Korean companies are seeking broader business opportunities in Vietnam after President Lee Myung-bak finished a weeklong Southeast Asian tour yesterday, industry officials said.

Last week, Lee visited Vietnam, Cambodia and Thailand to enhance bilateral relations and regional cooperation with Southeast Asia.

Particularly, Vietnam is gaining attention from Korean conglomerates and builders as the communist country is expected to become a stable business partner after the two state heads agreed to form a "strategic cooperative partnership," industry observers said.

POSCO, Asia`s third-biggest steelmaker, is in search of an industrial space to build a steel-manufacturing plant in Vietnam after it opened a cold rolling steel mill in the Phy My industrial zone near Ho Chi Minh City on Oct.19. The new plant, capable of producing 1.2 million metric-tons per year, is the largest of its kind in Southeast Asia, the company said. Even before the two countries established diplomatic relations in the early 1990s, POSCO had already entered the Vietnamese market and was conducting business in joint ventures with local companies, it added.



Kumho Asiana, a Korean conglomerate, is likely to begin with a city development project in Vietnam.

Prior to the president`s visit to Vietnam, a construction unit of Kumho Asiana opened a new landmark building named Kumho Asiana Plaza in the heart of the capital city and this has grabbed attention from local media already, the company said.

The company, specializing in logistics, air transport and construction, plans to expand business in the country by establishing transport and logistics networks between cities in Vietnam and neighboring countries, it added.

Lotte Group, which has been operating a confectionery unit in Vietnam since 1997, has also begun constructing a Lotte Center in Hanoi. The construction of the 65-story commercial-residential complex will cost $400 million and is scheduled to be completed in 2013.

SK Energy, an energy unit of SK Group, plans to expand oil-related business in the country.

"We expect to see strengthened economic ties between the two countries in the future and will expand the volume of export products such as petroleum to (Vietnam)," an official quoted by the Yonhap News Agency, said.

POSCO Engineering & Construction Co., an affiliate of POSCO, has recently signed a $137 million deal to build a section of highway in northern Vietnam. Under the deal with state-run Vietnam Express Corp., POSCO Engineering will construct a 22.1 kilometer section of the 224 kilometer highway linking the cities of Lao Cai and Noi Bai by 2013. Last March, the builder won a $150 million deal to build a 27 kilometer section of the highway.

Namkwang Engineering and Construction, a mid-sized builder in Korea, is also likely to clinch a subway construction deal in Vietnam, officials said.

(christory@heraldm.com)



By Cho Chung-un