1.1 Trillion Won Overseas Construction Fund Launched... Full-Scale Shift to Investment Development Model Begins

Government and Public Institutions Contribute 440 Billion Won, Private Sector Adds 660 Billion Won, Creating a 1.1 Trillion Won Fund
Investment Destinations Diversified: Vietnam, Indonesia, Saudi Arabia, United States, United Kingdom, and More
PIS Phase 1 Achieves 3.1 Trillion Won in Orders Across 29 Projects; Phase 2 Targets Advanced Markets
A Financial Competitiveness Strategy for Domestic Companies Amid PF Risks
Nam Youngwoo, Ministry Official: "Investment Development is the Key to the 2 Trillion Dollar Era"

As the overseas construction market rapidly shifts toward an "investment development model," the government has established a new fund to bolster the financial competitiveness of domestic companies. On September 4, the Ministry of Land, Infrastructure and Transport announced that it has completed the formation of the second phase of the Global Plant, Construction, and Smart City (PIS) Fund, totaling 1.1 trillion won, and will begin full-scale support for overseas investment development projects.

This fund was created by matching 660 billion won in private capital with a 440 billion won parent fund contributed by the government and public institutions. The sub-funds are divided into a blind fund (700 billion won) and a project fund (400 billion won). Capital will be supplied through various methods, including equity, loans, and bond investments.

The blind fund will be managed in three categories: the "Order Enhancement Fund" (250 billion won), which supports transportation and urban development projects in countries such as Vietnam and T?rkiye with a credit rating of BB- or higher; the "Order Vitality Fund" (260 billion won), which invests in projects in countries such as Indonesia and the Philippines with a credit rating of BBB- or higher; and the "Overseas Advanced Fund" (190 billion won), which targets advanced economies such as the United States, the United Kingdom, and Saudi Arabia. The 400 billion won project fund can provide swift support by recruiting investors and identifying individual projects simultaneously.

The first phase of the PIS Fund, launched in 2019 with a total of 1.5 trillion won, invested in 29 projects across 13 countries by June of this year, leading to approximately 2.2 billion dollars (about 3.1 trillion won) in overseas orders. Investment destinations have also diversified, including the United States (46%), France (21%), T?rkiye (11%), and the United Kingdom (8.5%). The fund is credited with serving as a bridge to transform the order structure, which was centered on contracting, into a high-value-added investment development model.

Nam Youngwoo, Director-General of Construction Policy at the Ministry of Land, Infrastructure and Transport, stated, "Last year, we achieved 1 trillion dollars in overseas construction orders, but the key driver to usher in the '2 trillion dollar era' will be investment development projects." He added, "The second phase of the PIS Fund will enhance the financial competitiveness of our companies and play a leading role in facilitating their entry into advanced markets such as the United States and Europe."