S. Korean builders cite red tape as a hurdle to winning contracts

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Construction personnel work beside scaffolding on a government elevated highway project in Manila on January 28 -- AFP

SOUTH KOREAN contractors interested in winning infrastructure contracts have pointed to bureaucracy as the main hurdle to their participation, depriving government projects of the most advanced construction methods as practiced by overseas builders.

International Contractors Association of Korea Asian Market Division Deputy General Kim Tae-wan said his association sees “inefficient” government bureaucracy as “problematic,” and the membership “hopes” the situation is resolved.

Speaking to reporters last week, Mr. Kim said the Philippines is a priority country for investment because it lags the rest of Southeast Asia in infrastructure development.

“Overseas contractors in the Philippines see that the inefficient government bureaucracy is one of the problematic factors and hopes for its improvement,” he added.

In 2017, there were 151 South Korean contractors active in the Philippines with 439 projects worth $15.1 billion. Most of these projects were industrial facilities and civil engineering works.

South Korea’s government is directing trade and investment into Southeast Asia under Seoul’s “New Southern Policy.”

Mr. Kim said South Korean builders hope to work around the difficulties by working with domestic counterparts and working on portions of projects requiring advanced know-how.

“Most government projects are done by local companies and the complex projects require (the involvement of) foreign companies,” he added.

“So it is a must that we try to look for more partnerships between foreign companies and local firms.”

Mr. Kim said bank funding may be key to winning projects tied to the participation of contractors from the bank’s country.

“(A South Korean bank) committed to fund $1 billion within the next six years and they are in discussion on which sectors they will be investing,” he added, without providing details. — Anna Gabriela A. Mogato