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Outlook rosy for builders, refiners, but carmakers face tougher year

All News 11:00 January 27, 2016

SEOUL, Jan. 27 (Yonhap) -- South Korea's construction firms and oil refiners are expected to benefit from massive overseas orders and stay competitive on the back of low oil prices this year, while automakers and electronics companies face tougher conditions, a report showed Wednesday.

According to the report compiled by the Korea Chamber of Commerce & Industry (KCCI), local builders are set to enjoy massive orders from Iran, while the launch of the Asian Infrastructure Investment Bank (AIIB) will boost demand for large construction projects.

Stable and low oil prices will help local petrochemicals and refiners carve out decent margins, while electronics firms face increased competition from China and other foreign rivals.

The growth of the global smartphone market is estimated at 7.4 percent this year, the lowest in five years, and prices of TVs are expected to stay low, the report showed.

Local steelmakers and automakers are also likely to face tougher business conditions this year.

Chinese steelmakers are expanding their presence in the local steel product market with cheap items, and a slump in overseas auto markets such as Russia and Brazil is likely to continue into the year, it said.

The local shipbuilding sector is among the segments to be hit hard by a slump in the global economy and low oil prices.

New shipbuilding orders are expected to drop 27 percent this year compared to last year, and costs stemming from a delay in the construction of offshore facilities will continue to rise, the report said.

sam@yna.co.kr
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