Construction technology, another Korean Wave leading the construction industry
Many architectural structures that gain attention in overseas construction markets are built with Korean construction companies’ technology. To name a few, Burj Khalifa, also known as the 21st Century Tower of Babel, and Marina Bay Sands, the miracle of architecture, are some examples of magnificent architectural feats. Here, we are going to take a look at the history and promising potential of ‘the Korean Wave in construction’ in this day and age, when the ‘Korea’ brand value is increasing in markets.
Pushing into world market since 1965
Korea’s construction industry started to enter into overseas markets in 1965. At that time, Korea enjoyed increased demands in military related constructions due to the Korean Army’s participation in the Vietnam War. 78% of the total amount of orders came from the Southeast Asian region. The first construction order from overseas was the Pattani-Narathiwat Highway in Thailand. Korea got the order that was worth 5.4 million dollars in 1965, and completed the construction in February 1968. Since the mid 1970s, the world construction market has been concentrated in the Middle East. The two oil shocks and subsequent rise in oil revenues caused a surge in demands for infrastructure projects in oil-producing countries.
The Alula-Kaiba Highway in Saudi Arabia, which was constructed in 1973 and was worth $24.05 million, was the first construction project that saw a Korean company stepping into the Middle East. The Jubayl Port construction project order was won three years later and was worth 931.14 million dollars, which was about 25% of the total national budget of Korea in those days, and is considered one of the largest construction projects in the 20th Century. In 1976 total contracts were valued at 2.5 billion dollars and with this Korea entered an era of quantitative expansion in the construction market. Compared to the order amount of the previous decade (683 million dollars), it was stunning growth. In the 1980s, Korea's position in the world construction market skyrocketed - achieving a total of 13.7 billion dollar in contracts, Korea became the world’s second biggest overseas construction powerhouse after the United States. The Great Manmade River Project (GMR) in Libya, the largest single case of construction in the world ($10.56 billion), is a good example that shows Korea’s status as a construction powerhouse.
Renaissance through change and challenge
As the good comes with the bad, Korean construction companies, which had achieved tremendous success in the good times, also experienced hard times, suffering from the economic depression in the Middle East and the global economic crisis.
Along the way, greeting the new millenium, our construction companies decided to make a breakthrough with diverse construction types and by operating in different regions. Currently, Korea is involved in various construction projects, such as refineries, super high-rise buildings, advanced technology buildings, river restoration, power plants and even ubiquitous city development along with IT initiatives. Now these efforts are bearing fruit, and inspiring the world. In 2003, Korea gained recognition for its desalination technology when U.A.E’s Fujairah Desalination Plant construction was completed (by Doosan Heavy Industries & Construction Co., Ltd.), and boasted its super skyscraper building technology with the Burj Khalifa project (by Samsung C&T Corporation) in 2009. Moreover, via Marina Bay Sands (by Ssangyong Engineering & Construction Co., Ltd.) in 2010, we have successfully managed the most difficult construction projects with our own technology.
The Korean people’s enterprising spirit, captured in the motto ‘nothing is impossible’, is ushering in a Renaissance in the overseas construction market.
Seventh place in terms of global construction competitiveness
According to a global construction competitiveness ranking published early this year by the Korea Institute of Construction Technology, Korea is positioned in seventh place out of twenty-three countries that provided data. Furthermore, in terms of ‘construction risk’, a section dealing with infrastructure competitiveness, we ranked fourth out of eighth. In the construction company capability section, we leaped five places from twelfth to seventh. This is because the profit from overseas increased dramatically with the growth in the construction competitiveness section (rank increase from twelfth to eighth) and planning competitiveness (rank increase from nineteenth to tenth).
Korea’s overseas construction industry is now enjoying a second golden period. The annual contract amount has continued to increase from $200 billion in 2006 to $300 billion in 2008 and $400 billion in 2010. And finally last year, it reached $500 billion. Now, it is obvious that overseas construction is leading Korea’s economic development with the annual contract amount far exceeding contract amounts for other major exporting industries, such as ships, vehicles or semiconductors. The key to the future of the global construction market is to be found in a combination of green energy plants and ICT(Information and Communications Technology).
In order to keep going with this Korean Wave in the construction industry, many relevant technologies related to climate change response, energy resources and the environment should be supported. On top of that, if we link our strengths, that is IT, BT(Bio-Technology) and NT(Nano-Technology), to construction, we could make an annual profits of one trillion won. Now, everything is ready. All we have to do is go out and plant Taegeukgi on the summits of the blue ocean markets in ubiquitous cities and eco city construction.