South Korea's major construction companies said Friday they are moving to expand
their overseas operations this year in an attempt to find new profit sources in
the face of a prolonged slump in the domestic market.
Hyundai
Engineering & Construction Co. said its overseas business will account for
65 percent of its total orders this year, up from 60 percent last year, by
diversifying its business in Africa, Asia and the former Soviet Republics beyond
the Middle East.
Meanwhile, Hyundai E&C slashed the number of
apartments it will sell this year in South Korea to 900 from 4,000 last year in
the latest sign of a housing market slump.
South Koreans are unwilling
to buy new homes as they are concerned that housing prices could further fall, a
widespread development that has led to piles of unsold apartments and further
hit profit margins of local construction companies.
"We will make
efforts to diversify overseas markets," said Jung Soo-hyun, the head of Hyundai
E&C, adding that his company will strengthen its global business capability
to meet the challenges of an uncertain environment.
Daewoo Engineering
& Construction Co. said it will also make inroads into the Latin American
and southern African markets in addition to the Middle East and Southeast
Asia.
Daewoo E&C also said it will seek to expand its business in
construction and development projects in cities in addition to industrial
plants.
The construction arm of Samsung C&T Corp. said it will
seek to find business opportunities in hospital projects as well as industrial
plants in the Middle East and Southeast Asia.
For decades, oil-rich
Middle Eastern countries have been the largest market for South Korean
builders.
Meanwhile, GS Engineering & Construction Corp. plans to
hire a senior executive and other marketing employees to break into markets in
the Americas, Africa and former Soviet Republics.
It also plans to
dispatch regional experts in Algeria and Myanmar, the two emerging countries for
construction companies.
Local builders won overseas orders worth
US$64.9 billion in 2012, up 9.8 percent from a year earlier, according to the
Ministry of Land, Transport and Maritime Affairs. But the volume was lower than
the government-set target of $70 billion, it added.
The builders said
they hope to clinch overseas orders worth up to $75 billion this year.