Korean builders’ domestic orders are expected to inch down this year due to a property market slump and economic uncertainties both at home and abroad, a report said Monday.
According to the report by the Construction and Economy Search Institute of Korea, builders are likely to win domestic orders worth a combined 102.7 trillion won ($94.5 billion) this year, down 0.5 percent from a year ago.
Builders’ domestic orders have been on the decrease for a fourth year since 2007, when they came to 127.9 trillion won, the report said.
Orders for civil engineering are forecast to sink 15.9 percent on-year to 34.8 trillion won this year, while those for buildings are predicted to rise 9.9 percent to 67.9 trillion won, the report said.
Orders from the private sector are expected to advance 3.4 percent to 67.1 trillion won this year from a year earlier, but those from the public sector are forecast to fall 6.8 percent to 35.6 trillion won.
Construction investment in the local market will likely inch down 0.2 percent to 156.7 trillion won this year compared with 157 trillion won a year ago.
Investment on civil engineering will face only a slight fall this year as the four-river project is now in full swing for completion by the end of the year.
In 2009, the Lee Myung-bak administration launched the 22 trillion won project to refurbish Korea’s four major rivers, saying it would help prevent floods and enhance water quality.
Opposition parties, religious groups and environmental activists have been trying to stop the project, which they say will badly affect the ecosystem.
Spending on homes will continue to remain sluggish until the end of the first half and will likely begin to pick up from the second half thanks to a rise in housing reconstruction, the CERIK said.
Most local builders have been facing cash shortages due to a protracted slump in the local property market since the onset of the 2008 financial crisis.