The Construction Association of Korea has been meeting to plan its northern strategy (CAK)

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South Korean contractors prepare for northern bonanza

15 June 2018 | By GCR Staff | 0 Comments

In the wake of the Singapore summit between Donald Trump and Kim Jong-un, South Korean builders are planning for a flood of infrastructure projects in the northern half of the peninsula.

The Construction Association of Korea plans to hold a forum for construction companies, research institutes and public entities on 25 June to discuss possible projects and funding arrangements.

The South Korean industry is expected to be led by Hyundai Asan, the South Korean contractor with the most experience of working in the Democratic People’s Republic.

During an earlier period of detente, in August 2000, Hyundai Group paid $500m for exclusive rights to spearhead seven projects over 30 years, including electricity and communications infrastructure, railways, an airport in Tongcheon, a dam on Imjin River, development of water resources from Mount Kumgang, and other tourist attractions.

It has already worked on the Kaesong Industrial Park, which was built on the North Korean side of the demilitarised zone.

Shares in Hyundai rose 27% following the successful meeting between the North Korean leaders and his South Korean counterpart, Moon Jae-in, at the end of April.

The Ministry of Land, Infrastructure and Transport last month met Hyundai, Daewoo Engineering & Construction and Samsung C&T to discuss ways of approaching projects in the north. Daewoo has already launched a task force for infrastructure projects, and has established a division to handle northern work.

Other South Korean companies are planning development opportunities if the political process results in a peace treaty between the Koreas.

Retail conglomerate Lotte has formed its own taskforce to plan hotel, shopping mall and agricultural projects. The company released a statement saying that “if a trans-Korea railway is connected to the trans-Siberian railroad as agreed by two leaders of Korea in April, we expect to play a contributing role in inter-Korean cooperation by vitalizing tourism business in the North by hotels and farms in Russia and Shenyang, China”.

Image: The Construction Association of Korea has been meeting to plan its northern strategy (CAK)

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