The history of Hyundai Engineering & Construction has largely been in line with that of the country’s construction industry, always just one step ahead of all the other competitors.

By clinching a $1.4 billion deal last month to build an oil refinery plant in Venezuela, Korea’s largest builder exceeded $100 billion in accumulated overseas orders.

This unprecedented amount was not only some 17 percent of the nation’s total sum but also more than double that of the runner-up, Daewoo Engineering & Construction.

“The order (from Venezuela) was all the more significant as it reflected the diversified business portfolio of Hyundai E&C,” said a company official.

The company currently holds $54.7 billion, or 54 percent of its overseas sales, in the Middle East market, but has been expanding its leverage in Asia and Africa, as well as in the Central and South America region.

“Though the Latin American region accounts for only 4 percent of our total overseas orders, it is here that we expect the most visible growth in the upcoming years.”

The overseas construction sector of Hyundai E&C, which is involved in a total of 781 projects in 55 countries, first kicked off in 1965 with a $5.4 million deal to build an expressway in Thailand. This was also the first overseas construction deal among Korean companies.

After its initial success in the Southeast Asian market, Hyundai E&C moved on to the Middle East in the 1970s, a period which is looked back on as the golden age of Korean construction history.

When the builder won a $930 million order in 1976 to build an industrial port in Jubail, Saudi Arabia, the windfall was the equivalent of almost 25 percent of the Korean government’s yearly budget.

“The entire country, along with the global economy, was going through a financial crisis triggered by the oil shock,” the official explained. “Even just the advance that was received, which was $200 million, was 10 times the total foreign exchange reserves held by the Bank of Korea back then.”

Hyundai E&C continued to thrive in the Middle East, especially through large projects such as the United Arab Emirates nuclear power plant deal in 2011, but decided to expand further into the global market and diversify its business risks.

“Our key strategy is to move beyond the overheated Middle East market and preoccupy ourselves with the emerging markets in Central and South America,” the official said.

Especially since it was incorporated into Hyundai Motor Group in 2011, the builder has been focusing on improving its profitability and optimizing the global business network of the new head company.

By Bae Hyun-jung
(tellme@heraldcorp.com)