(From the Korea Times)
By Choi Sung-jin
The upcoming reopening of the Iranian market may prove to be a double-edged sword for Korean contractors, industry sources said Wednesday.
Iran’s pent-up demand for building social infrastructure and oil plants is a boon for order-thirsty construction companies, they said. However, if Tehran aggressively resumes exporting crude oil to revitalize its economy, it could lead to an aggravation of the overseas construction market.
The Iranian government is expected to place orders worth $60 billion or more this year for building new gas and oil plants and modernizing the existing ones, according to industry officials.
Tehran reportedly plans to invest most of the $100 billion that had been frozen under the West’s economic sanctions into replenishing oil infrastructure, modernizing aged refinery facilities. Iran, a major oil producer, imports 5 million barrels of gasoline a day because of its outdated refining plants. Hyundai E&C and Daelim Industrial are expected to benefit from such plans.
Others are less optimistic about another Middle East boom, considering the complex effects that Iran’s comeback to the international business stage will have on the economies of other oil producing countries. Above all, Iran’s resumption of oil exports may likely add fuel to a plunge in international crude prices, they said. Read more