• Proceedings of the Korean Institute of Building Construction Conference
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• 2012.11a
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• pp.143-145
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• 2012

Overseas construction industry has performed the leading role in the economic development. In this study, effect of international oil prices, GDP and price index, on the regional international construction contract amount is compared and analyzed. Overseas construction market received a devastating effect due to the 1997's economic crisis. However, the market has remained stable since 1998, and since 2005, the trend has been a surge in new orders.

• International conference on construction engineering and project management
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• 2005.10a
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• pp.862-868
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• 2005

The history of Korea's overseas construction began in 1965, and the cumulative contract amount is about $180 billion over the last 40 years. During the period, Korea's overseas construction industry has played an important role for economic development. However, it seems that the industry is in a sea of trouble. Overseas construction orders have declined due to various reasons such as companies losing confidence, limited financing, lack of competitiveness, and so on. This paper addresses the brief history of Korea's overseas construction industry and the problems that the industry is facing. Then it suggests a few measures for the improvement of the industry.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
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• v.48
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• pp.127-155
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• 2010

The international transactions of capital goods such as industrial plant exports, overseas constructions, and shipbuilding exports, are so huge that tremendous amount of funds are required, and that most of the loans are long-term credits of over five years. In the export of huge capital goods, financing is more crucial than technology itself. Some of the importing countries are developing ones that are politically and economically unstable. Therefore the financing mechanism for these transactions is conclusive in winning these projects. Global financial market instability caused by US sub-prime mortgage financial crisis expanded all over the world, and the international transactions have been decreased due to global credit crisis. This indicates how much influential the financing market is in international transactions. The financing schemes are classified into supplier credit and buyer credit by who provides the financing. A supplier credit is a credit extended by an exporter(seller) to an importer(buyer) as part of an export contract. Cover for this transaction may be extended by an export credit agency('ECA') to the exporter. In a sales contract a seller shall provide fund required to manufacture goods, and in a construction contract a contractor shall provide fund required to complete a construction. A buyer credit is an arrangement in which an exporter enters into a contract with an importer, which is financed by means of a loan agreement A Comparative Study on a Supplier Credit and a Buyer Credit in International Transactions of Capital Goods 155 where the borrower is the importer. In a sales contract a buyer shall provide fund required to manufacture and procure the goods, and in a construction contract an owner shall provide fund required to complete a construction. Therefore an exporter is paid on progressive payment method. A supplier credit and a buyer credit have their own advantages and disadvantages in the respect of the parties respectively. These two financing methods are selectively used considering financing conditions such as funding cost, importer's and/or exporter's financial conditions, importing country's political risk.

• Korean Journal of Construction Engineering and Management
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• v.19 no.2
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• pp.107-116
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• 2018

Since 2010, Korea's overseas construction orders have seen dramatic fluctuations. I propose causes and remedies for the industry as a whole. Orders have recorded an annual average of $63.8 billion dollars from 2011 to 2014, reaching its highest at $71.6 billion dollars(2010) which marked the peak of Korea's overseas construction. However, due to a decline in international oil prices, starting in the last half of 2014, Korea's overseas construction orders have followed suit recording $46.1 billion dollar in 2014, $28.2 billion dollars in 2016, and $29.0 billion dollars in 2017. Facing uncertainty in Korea's overseas construction market, caused by continued slow growth of the global economy, Korean EPC contractors are at a critical point in regards to their award-winning capabilities. Together with declining oil prices, the challenges have never been bigger. To mitigate the challenges, I would suggest policy direction as a way to grow and develop the overseas construction industry. Proper counterplans are needed to foster Korea's overseas construction industry. Forecasting total order amount for overseas construction projects is essencial. Analyzing contract award & tender structure and its changing trends in both overseas and world construction markets should also be included. Korea has great potential and global competitiveness. These measures will serve to enhance Korea's overall export strategy in uncertain overseas markets and global economy.

• Journal of the Korea Institute of Building Construction
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• v.24 no.2
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• pp.273-284
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• 2024

This study investigates the impact of international oil price fluctuations on overseas construction orders secured by domestic and foreign companies. The analysis employs statistical data spanning the past 20 years, encompassing international oil prices, overseas construction orders from domestic firms, and new overseas construction orders from the top 250 global construction companies. The correlation between these variables is assessed using correlation coefficients(R), determination coefficients(R²), and p-values. The results indicate a strong positive correlation between international oil prices and overseas construction orders. The correlation coefficient between domestic overseas construction orders and oil prices is found to be 0.8 or higher, signifying a significant influence. Similarly, a high correlation coefficient of 0.76 is observed between oil prices and new orders from leading global construction companies. Further analysis reveals a particularly strong correlation between oil prices and overseas construction orders in Asia and the Middle East, potentially due to the prevalence of oil-related projects in these regions. Additionally, a high correlation is observed between oil prices and orders for industrial facilities compared to architectural projects. This suggests an increase in plant construction volumes driven by fluctuations in oil prices. Based on these findings, the study proposes an entry strategy for navigating oil price volatility and maintaining competitiveness in the overseas construction market. Key recommendations include diversifying project locations and supplier bases; utilizing hedging techniques for exchange rate risk management, adapting to local infrastructure and market conditions, establishing local partnerships and securing skilled local labor, implementing technological innovations and digitization at construction sites to enhance productivity and cost reduction The insights gained from this study, coupled with the proposed overseas expansion strategies, offer valuable guidance for mitigating risks in the global construction market and fostering resilience in response to international oil price fluctuations. This approach is expected to strengthen the competitiveness of domestic and foreign construction firms seeking success in the international arena.

• Korean Journal of Construction Engineering and Management
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• v.14 no.5
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• pp.84-91
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• 2013

In 2012, Korean overseas construction market has achieved 64.9 billion dollars of contract order and its amount has increased since the mid 2000's. However, importance of qualitative growth based on profitability as well as quantitative growth is also emphasized. This study analyzed overseas plant project's subcontract process management which is closely related to cost management as one of the qualitative growth methods. In order to select major subcontract processes, extensive literature review and focus group interview(FGI) were implemented and then professionals with years of experience in the overseas plant projects were participated in the questionnaire survey. The collected data were analyzed by Benefit-Structure Analysis(BSA) model. The findings of this study include: (1) the seven and six subcontract processes are positioned in the area of importance control factor and in the area of maintenance/control factor, respectively; (2) administration capability attainment is needed for the six subcontract processes in the area of importance control factor and sustainable management system is required for the processes in the maintenance/control factor area. The further research will identify key subcontract processes to be managed for overseas plant projects by Korean EPC contractors based on the findings of this research.

• Korean Journal of Construction Engineering and Management
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• v.17 no.5
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• pp.97-107
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• 2016

CM services have been focused on the advancement of the CM industry and expansion to overseas market based on CM capabilities. However, there has been lack of quantitative and comprehensive research to investigate current CM trends and prospects for improving competitiveness. In this sense, the purpose of this study is to statistically analyze total of 3,453 CM service contracts over the past 18 years (between 1997 and 2014) in term of market type, contract size, owner's type, commodity type. Finding of this research reveal that 1) compared to 2005, CM market size in 2015 increased as much as 2.5 times, and that 2) domestic CM projects count for 87.5%, architectural project 88.4%, less than 1 billion won small contracts 75%, respectively. Also, recently as CM company are developing capability and competitiveness, 1) overseas CM market share has grown up to 20% among total CM contract amount, and 2) CM contracts by private owners has increased 3 times demanding the total management services based on high technical capability. Additionally, the result of this paper supports the growth path model proposed by Jung et al. (2014), where a path from Domestic Public (DP3) and Domestic Private (DC2) CM projects towards the expansion to International Private (IC5) contracts was quantitatively analyzed. Implications for other practical issues are also briefly discussed.