Korea construction industry troubled by ME unrest
Overseas construction orders for first eight months 58% down from 2010
Volatility in the financial markets and the Middle East is having a major impact on the Korean construction industry.
According to the International Contractors Association of Korea, construction orders for the first eight months of the year were $26.9 billion; 58% down from a year earlier.
Korea is home to some of the biggest construction players and machine makers in the world, such as Hyundai Engineering & Construction and Doosan, and is heavily reliant on foreign exports.
“China’s exports to the United States are expected to be shrunk in the wake of the US economic turmoil, which means Korea’s exports to China will be affected in turn,” a chief researcher at the Korea Institute for Industrial Economics & Trade explained to the The Korea Times. “Korea’s heavy dependency on exports is likely to suffer from the double or triple impact of global economic problems.”
According to the local media, Korean companies are also preparing for the worst in the coming months.
A spokesperson for Hyundai Engineering & Construction commented that: “In the aftermath of unrests in the Middle East, major construction projects were deferred to the second half of the year. If the US economic crisis were to worsen, those projects would suffer further setbacks.”