Korean contractors set to cash in on S'pore construction boom
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Published February 21, 2007
Korean contractors set to cash in on S'pore construction boom
3 major firms bag $1b worth of deals in past 9 months after decade-long slump
By HAN MIN CHUNG
(SINGAPORE) Korean contractors in Singapore are starting their crane engines again.
This year could be the biggest year for Korean contractors such as Samsung Corporation, Ssangyong Engineering & Construction Co and Hyundai Engineering & Construction Co after nearly a decade of construction slowdown in Singapore.
They are hoping to capture a bigger slice of the boom in the Singapore construction sector, which is expected to see record contracts totalling nearly $19 billion.
The three major Korean contractors have so far bagged $1 billion worth of contracts in the last nine months.
'We are making a comeback through the Sentosa Cove project,' Korea Ssangyong Engineering & Construction senior vice-president Ahn Kook Jin told BT. The company is handling a $130-million contract to build the 264-unit condominium on Sentosa Island.
Another major Korean contractor, Samsung, is involved in big projects such as the Island Power Plant ($450 million) in Jurong Island and Wacker Siltronics Semiconductor Wafer Plant ($225 million) in Tampines.
Hyundai is also enjoying a boom. It just clinched the $154-million contract for One Shenton for City Developments.
Korean contractors, which are well known for their efficiency and quality work, have always played a big role in Singapore's construction scene.
Their best year was 1997 when they collectively secured orders exceeding $2 billion, according to information collated by the International Contractors Association of Korea.
During the heydays of the 1990s construction boom, Korean contractors were involved in big projects like Raffles Hotel, Raffles City, Suntec City and Capital Tower.
But the building slump since then affected Korean contractors badly.
Over the last five years, they managed to clinch contracts valued at less than $300 million annually.
'Due to the construction slump in Singapore, we concentrated on Middle East instead of South-east Asia. Also, we need to do internal risk management that's why we had a poor record in Singapore,' said Thomas Cho, general manager of Samsung.
But the Koreans are now eyeing big spin-offs from the construction of the two mega integrated resorts and casinos at Marina Bay and Sentosa. The two projects, which are scheduled to be completed by the turn of the decade, are worth a total of more than $10 billion.
Marina Bay IR is being developed by Las Vegas Sands. The other IR project on Sentosa is being developed by Malaysia's Genting group.
'The number of order offers received is increasing but to focus on the IR we declined other offers,' said Kim Seung Shik, deputy general manager of Ssangyong.
'We hope to join Marina Bay IR project and the Overseas Union House project.'
