SEOUL, January 22 (AJP) - South Korean construction companies are assessing potential opportunities in international reconstruction projects under U.S. President Donald Trump’s administration, while grappling with challenges posed by interest rate hikes and exchange rate volatility.
Industry analysts warn that high U.S. interest rates under Trump could weigh heavily on South Korea’s construction and real estate sectors. With the dollar-won exchange rate hovering around 1,450 amid domestic political uncertainty, rising costs for imported raw materials remain a key concern for builders.
One significant opportunity lies in the post-war reconstruction of Ukraine, a project valued at $486.3 billion through 2033, according to the World Bank. South Korea, which joined the G7-led reconstruction support group last year, has been pursuing public-private partnerships in infrastructure projects, including railways, airports, dams, and power plants.
Trump’s push to expand nuclear power and streamline regulations adds another dimension of promise. Hyundai E&C and Daewoo E&C are actively seeking contracts in the U.S., particularly as the administration promotes the development of small modular reactors.
The Korean government has set an ambitious target for $50 billion in overseas construction orders for 2025, a 20 percent increase from the previous year.
Yet, Trump’s energy policies offer a mixed outlook for South Korean firms. While an increase in U.S. oil production could stabilize construction material costs, a potential drop in global oil prices might curtail opportunities in the Middle East, where Korean builders secured $18.5 billion in contracts last year, nearly half of their overseas orders.
“Interest rate movements will be critical under the Trump administration,” said Kim Hyo-sun, a senior real estate analyst at NH NongHyup Bank. “U.S. rates are unlikely to decline as quickly as some had anticipated, which will impact both funding costs and global construction dynamics.”
Copyright ⓒ Aju Press All rights reserved.