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S. Korea To Set Up Us$500 Mln Industrial Plant Fund In H2

Mar 15, 2012
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South Korea will establish a
US$500 million industrial plant building fund to help local
builders win overseas contracts, the government said
Thursday.


The plan, outlined at a weekly economic policymakers
meeting, calls for the pooling of money from local pension
operators and Middle East sovereign funds so South Korean
engineering and construction companies can better secure new
deals.


"Since construction projects are becoming bigger,
value-added and high risk ventures, the ability of builders to
come up with financing has become a key prerequisite for
securing orders," the Ministry of Knowledge Economy said.


Creating an industrial plant fund that can take advantage of
money from oil rich countries in the Middle East could help
South Korean construction firms in overseas markets, the
ministry said.


At present, local financial institutions are generally
unable to provide adequate funding even as builders bid for
contracts with foreign rivals.


The ministry said that a joint investment task force will be
set up with operators of sovereign funds from such countries as
the United Arab Emirates and Qatar to check for projects
eligible to receive funding support.


The government, meanwhile, said that it plans to increase
the size of non-taxable income for overseas construction
workers from 2 million won (US$1,760) per month to 3 million
won.


The 50 percent increase in non-taxable income aims to help
relieve the shortage of South Korean workers willing to work on
foreign construction projects.


(Yonhap) cg