Mideast unrest takes toll on Korean construction companies

Unrest in the Middle East and North Africa is dealing a heavy blow to Korean builders, which are highly dependent for business on both areas.

The International Construction Information Service said Wednesday that Korean construction companies received 62 overseas orders worth 6.41 billion U.S. dollars in January and February, a fourth of the 25.49 billion dollars secure over the same period last year.

Mideast orders over the same period were worth 3.84 billion dollars, 18 percent of the 21.1 billion dollars landed last year.

The plunge in orders, however, is largely due to the effect of the contract to build nuclear power plants in the United Arab Emirates in January last year worth 18.6 billion dollars. If the UAE project is excluded, orders in the first two months of this year are around 80 percent of those over the same period last year.

This year`s goal of 700 billion dollars by Korean builders, which was met last year, is unlikely to be reached as advanced economies such as Japan and France are raising their competitive edge this year on the back of the falling values of the yen and euro and political instability in the Middle East.

redfoot@donga.com