Overseas Construction Cumulative Orders Reach '1 Trillion Dollars'

Last Year's Overseas Construction Contract Amount Under Review, To Be Released Next Week

Minister of Land, Infrastructure and Transport Park Sang-woo is delivering a congratulatory speech at the REITs 100 Trillion Achievement Ceremony held at the FKI Tower Conference Center in Yeongdeungpo-gu, Seoul, on December 26 last year. Photo by Yonhap News

The cumulative overseas construction orders of domestic companies surpassed 1 trillion dollars for the first time in 59 years since the first order in 1965.

According to the Ministry of Land, Infrastructure and Transport on the 3rd, the cumulative overseas construction orders reached 1 trillion dollars (approximately 1,468 trillion KRW) at the end of last year.

The cumulative order amount was 996.5 billion dollars until November last year, but surged past 1 trillion dollars by the end of the year due to a rush of orders. Minister Park Sang-woo of the Ministry of Land, Infrastructure and Transport cited "achieving 1 trillion dollars in cumulative overseas construction orders" as a key achievement in his New Year's address and said it "greatly contributed to national economic growth."

The Ministry of Land, Infrastructure and Transport will announce last year's order performance next week. The annual overseas construction order amount for last year is still being compiled. According to the Overseas Construction Association, overseas orders from January to November last year amounted to 32.69 billion dollars.

Overseas construction orders peaked at 71.6 billion dollars in 2010, then declined to 22.3 billion dollars in 2019 due to the US-China trade dispute and reduced orders from the Middle East. Since then, orders have shown an increasing trend with 30.6 billion dollars in 2021, 31 billion dollars in 2022, and 33.3 billion dollars in 2023.

Last year's overseas orders from the Middle East accounted for about 50%, up 16 percentage points from 34% the previous year. Hyundai Construction secured the 'Amiral Petrochemical Plant (5.08 billion dollars)' project last year. Additionally, Samsung E&A and GS Construction won the 'Fadhili Gas Plant Construction (6.08 billion dollars)' contract from Saudi Arabia's state-owned oil company Aramco, marking the largest order ever for Korean construction companies in Saudi Arabia.

The Ministry of Land, Infrastructure and Transport aims to expand investment and development-type orders, which have higher added value, beyond simple contract construction orders. Investment and development-type projects involve participants bearing a portion of the costs to propose projects and sharing profits and losses according to their equity stakes. The share of such projects in overseas construction orders averaged 5.1% annually from 2018 to 2022, but increased to the 10% range last year.