[Exclusive] "Looking at the US and China with Both Eyes, Turning to Third Countries": LS's Global Strategy

Himalayan Hydropower as the Foundation: Bhutan's Leap Toward a Digital Hub
LS's Urban Design Strategy: From Power Grids to Daily Necessities
Ukraine Entry Scenario: Targeting Opportunities in Postwar Reconstruction
Turning Sunflower Oil into Eco-friendly Fuel... New Initiatives in Ukraine

"We must look at the United States with one eye and at China with the other. But at the same time, we also need to turn our heads to watch third countries."

This is the core message that LS Group Vice Chairman Myung Nohyun has repeatedly emphasized in recent strategic meetings with executives. LS Group's expansion of its infrastructure business into emerging markets such as Bhutan and Ukraine is not simply about pioneering overseas markets. In a situation where the global supply chain is becoming polarized around the United States and China, and major countries are raising tariff barriers to protect their own industries, this is part of a "complex strategy" to diversify structural business risks.

LS is pursuing a parallel approach by expanding local production through the existing ultra-high voltage transformer and communication cable plants in the United States, while also designating politically neutral countries with proven real demand as new growth bases. In particular, Bhutan and Ukraine are considered to have high strategic value as long-term profit bases, as they each have unique demands for eco-friendly energy infrastructure and postwar reconstruction industries, respectively.

Bhutan New City Development Project: Entry through Eco-friendly Power Infrastructure

LS's approach to building power infrastructure in Bhutan involves designing the structure from the very beginning of the city's birth, enabling early-mover advantages. With affordable and stable electricity secured through Himalayan hydropower, Bhutan is a region being considered by global IT companies as a potential location for data centers. LS plans to provide not only power and communication networks but also an integrated supply chain for daily necessities. By creating a "demand base" even before city functions are established and supplying eco-friendly power infrastructure in line with the carbon neutrality trend, LS aims to proactively secure ESG (Environmental, Social, and Governance) demand as well.

The Bhutanese government is currently pursuing a national project to create the "Gelephu Mindfulness City" in the Gelephu region bordering India, covering approximately 2,500 square kilometers. The plan is to secure 15 GW (gigawatts) of hydropower by 2040 and 25 GW by 2050, establishing the area as an eco-friendly digital hub to meet the needs of artificial intelligence (AI) and high-performance computing (HPC).

To attract energy-intensive industries such as data centers, the area has been designated as a Special Administrative Region with independent regulations and autonomy. In January, the U.S. newsweekly Time reported that the total project cost for this city development could reach approximately $100 billion. This is a mega project led by the Bhutanese royal family, amounting to 30 times Bhutan's GDP.

During this process, India's Adani Group is discussing a master plan with the Bhutanese government to build a 570 MW hydropower plant and a computing center. Global IT companies such as Amazon and Microsoft are also considering building data centers in the Gelephu area, attracted by the low electricity costs. In line with this development trend, LS plans to proactively establish power infrastructure and distribution networks from the early stages of the Gelephu new city project, aiming to become a key player in the data center power supply chain in the medium to long term.

Ukraine Supply Chain Preemption Strategy Targeting Postwar Reconstruction and Food Security

LS's approach to Ukraine is also an extension of its supply chain preemption strategy. In February, LS formed a due diligence team to visit major cities such as Lviv and Kyiv, conducting multiple working-level discussions with senior officials from the local Ministry of Agriculture. Anticipating that the agricultural sector will see the fastest demand recovery once postwar reconstruction begins in earnest, LS explored the supply of tractors, agricultural machinery, and energy storage systems (ESS).

In particular, LS is actively considering not only the simple sale of agricultural equipment but also the direct establishment and operation of local agricultural corporations. Recognizing that Ukraine is the world's largest producer of sunflower oil, LS is pursuing participation in businesses related to edible oil and SAF (sustainable aviation fuel) using sunflower seeds as raw materials. The company envisions a comprehensive infrastructure model that involves directly sourcing sunflower raw materials locally, securing storage facilities, installing refining plants for processing, and building a supply chain through logistics systems. This represents another form of LS Group's complex strategy to address both energy and food security in the global market, directly linking to Ukraine's postwar economic recovery.

Expansion of investment into Southeast Asia and North Africa is also being carried out under the same strategy. Existing bases such as Vietnam, Indonesia, and Myanmar are focused on strengthening the connection between production sites and demand centers, while North African countries such as Algeria and Tunisia are being classified as strategic candidates due to their high demand for power infrastructure.

With the prolonged U.S.-China conflict, LS Group's attempt to enter geopolitically neutral countries with clear demand and design the structure of cities and industries is seen as a long-term investment strategy that goes beyond simple exports. For companies, early entry into infrastructure is a way to secure an entire future profit base, and for countries, it helps establish an industrial foundation.

An LS Group official stated, "Right now, how you design the structure is more important than the technology itself," adding, "Only companies that enter markets with low entry barriers and real demand first to build the structure will have growth opportunities in the next phase."