S. Korea's industrial plant orders plunge 61.3 pct in Q1: report

By Lee Joon-seung
SEOUL, April 8 (Yonhap) -- South Korea's industrial plant orders plunged sharply
in the first quarter as businesses and governments tightened spending in the face
of the global economic crisis, an industry report said Wednesday.
The report by the Ministry of Knowledge Economy and the Korea Plant Industries
Association said orders nosedived 61.3 percent on-year to just US$4.3 billion
from the $11.2 billion tallied in the first three months of 2008.
"The ongoing economic slump and uncertainties about the future have effectively
made it hard to get financing for large-scale projects like marine platforms,
petrochemical and industrial plants," Kang Myung-soo, head of the ministry's
export-import division, said.
He also said the sharp drop in energy prices has caused funds going into
resource-rich Middle Eastern countries to dry up, making them delay or downsize
construction projects.
The average price of Dubai brand crude fell to US$44 per barrel this year from
$94 in 2008.
By region, orders for the Middle East and Africa were down 11 percent and 3
percent from a year earlier to $2.5 billion and $963 million each, while those
for the United States and Asia fell 96 percent and 93 percent, respectively.
Orders from European countries were down 80 percent annually in the January-March
period.
The latest report, in addition, showed orders for marine platforms like oil rigs
and floating production storage and offloading vessels falling 87 percent, with
numbers for desalination, petrochemical and industrial plants all falling sharply
in the cited period.
Orders for gas and oil plants surged 490 percent to $3.0 billion thanks mainly to
contracts placed by Saudi Arabia and the United Arab Emirates.
The first quarter tally, meanwhile, cast a shadow on the government's plan to
secure $50 billion worth of overseas plant construction orders this year, up from
the record high $46.2 billion reached last year.
yonngong@yna.co.kr
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