Offsetting a prolonged slump in domestic construction orders, overseas demand for Korean builders has been on the rise, particularly in the Middle East.
According to the International Contractors Association of Korea, the value of overseas construction orders procured by Korean builders surged 67 percent to $16.2 billion in the first quarter of this year compared to the same period a year ago.
“The overseas order amount for the first three months was the highest in four years since the same period in 2010 when overseas orders reached $28 billion,” said Kim Keun-tae, an official at ICAK.
The growing volume of building orders in the Middle East and other emerging markets, including African and Southeast Asian countries, has boosted overseas construction orders in the first quarter, he added.
In fact, in February a local consortium won a $12.3-billion deal to build an oil refinery and petrochemical plant in Kuwait, so far the biggest order between January and March.
Another power plant order in Algeria followed.
The Ministry of Land, Infrastructure and Transport issued a positive outlook for overseas orders this year based on the planned plant-building projects in the Middle East and infrastructure-building projects in Southeast Asia.
“Overseas construction orders picked up by Korean builders are expected to exceed the 2014 target of $70 billion within a year,’’ the ICAK official projected.
In 2013, local construction firms clinched up to $65.2 billion won in overseas construction orders. The figure was the second highest in the country’s history.
The industry outlook is now helping to lift the morale of the construction sector, which had been suffering from a protracted business slump triggered by lukewarm construction demand at home and abroad.
“The most positive aspect this year is that local builders started working together. Previously, they had competed for the same project, which had led to cutting down the overall value of the deal,” said Lee Sang-wook, a spokesman for GS Engineering and Construction, the nation’s third-largest builder.
Six local builders, including GS, Daewoo, Samsung Engineering and SK, had formed the consortium that attained the plant deal in Kuwait.
“This partnership will help companies usher in an era of further success in the overseas markets,” Kim of ICAK said.
By Seo Jee-yeon (email@example.com