MOCT Minister's Visit Aimed
at Emerging African Market

Accelerates Korea's entry into the market as part of its efforts to diversify

Minister of Construction and Transportation Chu Byung-jik's recent visit to Nigeria and Algeria is expected to gain momentum in Korea's attempt to secure a bridgehead in the newly emerging African market, government officials and industry experts concur. MOCT Minister Chu accompanied President Roh Moo-hyun, who made a state visit to the African countries between March 8 and March 23.
Minister Chu inked an MOU on promoting the transportation sector between both sides with his Nigerian counterpart Dr. Precious Sekob, in the presence of their respective heads of state.
The agreement calls for both sides to promote exchanges of experts and engineers as well as sharing of information on transportation-related construction markets and mutual support for landing construction orders. The deal is expected to lay a foundation for promoting human and material exchanges and collaborating mutual support for landing orders.
Minister Chu held another separate meeting with Minister Sekob in the afternoon of March 10 and asked for the Nigerian side's support for Korea's participation in a $1.5 billion project to overhaul railway systems in the African country. Nigeria with a population of 137 million is Africa's biggest crude oil exporting country. The African country is expected to launch a combined $40 billion worth of crude oil and gas production facility projects in the next five years. Korea aims at making its entry to Nigeria a bridgehead for entering the mid-west African area, including Angola and Congo.
Korean construction companies have landed 60 projects worth $4.6 billion, accounting for 75 percent of the total amounts from Africa, since setting foot in Nigeria in 1974. Korean companies are now participating in 18 projects worth a combined $3.4 billion won, including a gas pipeline project being undertaken by Daewoo E&C and a gas plant project by Hyundai Heavy Industry. Korean contractors are striving to receive three projects worth some $2 billion, including gas collection facility and railway refurbishment projects.
Daewoo E&C, which successfully implemented $1.8 billion worth of 51 projects in the past 30 years, has three projects worth $1.5 billion in December 2005, January and February 2006 thanks to higher credit ranking from the Nigerian government and energy companies.
During his visit to Algeria, Minister Chu signed an MOU on urban housing development with Algerian Housing Minister Mohamed Hamimid as well as an MOU on the construction sector with Public Project Minister Amar Choul on March 12, respectively. Minister Chu also discussed ways of promoting cooperation between the two countries with Minister Hammid, Minister Choul and Transportation Minister Mohamed Maghlaoui.
Minister Hamimid explained his government's projects to build 1 million housing units and new cities and expressed the hope for Korean construction companies'active participation in the ongoing projects. In return, Minister Chu asked for the Algerian government's active support and decided to discuss detailed steps of promoting cooperation between Algerian housing officials and Keangnam Enterprises, Ltd officials. Besides the project to construct 1 million housing units, the Algerian government is pushing ahead with projects to build a scientific city and new satellite cities to cope with a housing shortage in the capital area.
During his meeting with Public Project Minister Choul, Minister Chu expressed an interest in the five-year economic development plan between 2005 and 2009, being pushed by the Algerian government, and asked for Korean firms'participation in the projects, to be carried out under the economic development plan.
Capitalizing on having a bountiful budget, arising from crude oil prices, and economic strides, the Algerian government will likely invest about $60 billion to build up such infrastructure as roads, ports, airports, dams, desalination facilities and natural gas pipelines. The African country plans to implement an $8 billion project to build an expressway linking east and west of Algeria, a $7.6 billion hydroelectric power plant project and a $7 billion natural gas pipeline construction project.
Three Korean companies landed five projects worth a combined 143 billion from Algeria. Keangnam Enterprises is now undertaking three projects worth a combined $987 million.
Korean contractors have shown much interest in Algeria, which has a geopolitical advantage as a linkage between Europe and Africa. A market feasibility delegation was sent to the African country last February. nw

MOCT Minister Chu Byung-jik meets with (from left) Algerian Public Project Minister Amar Choul,Housing Minister Mohamed Hamimid and Transportation Minister Precious Sekob during his recent visit to the African nation.