Environmental Analysis of the Target Countries
for Overseas Expansion of Long-Life Housing
Joonsoo Chung*
Bora Lee**
Taejun Kim ***
Daewoon Chung ****
Jeongjoo Kim ****
Abstract
Currently Korean construction industry is shifting its interest in the overseas construction market because of the stagnating
domestic market. In the meanwhile, the international housing construction market is in expansion in connection with new city
development projects supported by the population growth and the urban migration of the population in various countries.
However, in spite that Korean construction industry have know-hows on the new city development and the technology and
system for apartment supply, the share of Korean players in the international housing construction market is continuously
decreasing. As a measure to overcome such circumstance, the authors of this study considers ‘the Cost Saving and Long-Life
Housing Technology and Support System’ that is under progress as a national policy research.
Through the literary research and the interviews with experts, it has been found that ‘column + minimum interior(infill)’
apartments similar to the Long-Life Housing in some areas in China, Southeast Asia and Russia. Candidate countries expected
to be possible for the entrance of Long-Life Housing was selected by drawing top already entered countries through a little
more specific techniques. And the external environments of selected countries are analyzed. Through such process, the
authors present followings as the results.
First, based on the general fact that countries having more population, higher population growth rate and higher national
economic power, the attraction of house market of each countries in the world are measured with the population and economy
variables. Then the market groups of possible entrance are divided as Population Promising Market, Advanced Market,
Economy Promising Market and Immature Market. Second, top countries where Korean construction industry has already
entered in the house and city construction are found to be Vietnam, Libya, China, Algeria, UAE, Saudi Arabia, Kazakhstan,
Angola, Iraq and Singapore. By comparing with the countries in possible entrance market groups, Vietnam as in Population
Promising Market, UAE and Singapore as in Economy Promising Market and China and Saudi Arabia as in the emerging
promising market are selected.
Third, according to the studying on the opportunity factors of the cities where Long-Life Housing has been introduced in 4
areas of Vietnam, UAE, China and Khabarovsk in Eastern Russia, it has been found that, as the opportunity factors, 1) All 4
places are where the house demand is already increasing or is expected to increase. And, except UAE, apartments are generalized.
2) The commonness in the apartments in 3 countries except UAE is the column or combined type and the interior materials are
separated from the building structure and installed by residents. 3) In cases of Vietnam and China, the entrance possibility is
systematically opened due to the inter-government agreement or convention.
Keywords : Environmental Analysis ; Overseas Expansion ; Long-Life Housing
I. Introduction
*
Research Associate, Korea Research Institute for Construction
Policy, Korea
** Research Fellow, Korea Research Institute for Construction
Policy, Korea
*** Senior Researcher, Korea Research Institute for Construction
Policy, Korea
**** Researcher, Korea Research Institute for Construction Policy,
Korea
This study was made possible by financial support from part of
results a major research project conducted by the Korea Ministry of
Land, Infrastructure and Transport, Residential Environment Research
Project in 2014. Project No.: 14RERP-B080965-01
Contact Author : Joonsoo Chung, Research Associate, Korea
Research Institute for Construction Policy, 15 Boramae-ro
5Dongjak-Gu, Seoul, Korea..
Tel: (82 + 2)32842629 e-mail: [email protected]
1. Background and Aims of the Study
Korean construction industry has been expanding the scale
of international contract while performing major roles in the
national development in each difficult period ever since its
entrance in the international market in 1965. Since the
overseas market entrance of Korean construction industry has
been helping the national growth, each new government has
established policies for the overseas construction market
entrance. Because of such efforts, Korean construction
industry is about to achieve the yearly contract amount of
around 70 billion USD with approx.8% international market
share.
However, unlike such brilliant achievement, the status of
overseas market entrance of Korean construction industry
The Asia Pacific Network for Housing Research (APNHR) April 2015
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shows the issues of limited types (mostly plants) and areas
(mostly Middle East) as well as the decreased market share in
the international hose construction market. And Korean
construction industry, different from the trend in Japanese
construction industry, shows the activity to search for
overseas market entrance when the domestic construction
market becomes unsound. Recently, Korean construction
industry is shifting its interest in the overseas construction
market because of the stagnating domestic market. However,
the forecast that the overseas market entrance will become
difficult due to the recent low oil prices (2014), the industry
struggles to produce the breakthrough and considers the
market diversification and the expansion of construction type.
Unlike the bustle of Korean construction industry, the
growth of the world population and the inflow of the
population into cities causes housing shortages in cities and
additional developments of cities. The counties facing such
situation are planning or constructing new cities to resolve the
housing shortage in large cities by the population increase
and the urban inflow of population. Especially, the most of
overseas apartment constructions is shown to be related with
such new city developments.
The statistics of public institutions in the world show the
forecast of 70% urbanization and 2.9 billion population
increase in cities in the world by 2050. Such scale requires
about 9,150 new cities in the size of Dong-tan 2 New City in
Korea. 90% of the new cities will be happening in China and
Southeast Asian countries. It is noted that China currently is
constructing or planning about 150 new cities. Such newly
built cities and buildings basically contain the global trend of
‘sustainability’.
Korean construction industry has found its needs for new
items and strategies to enter in the house construction markets
active in all over the world. Such needs share the same
context with the previously mentioned diversifications of the
construction types and areas.
The authors of this study see the technology and system of
cost saving and Long-Life Housing recently studied for the
national policies as new items. Also, the authors think the
external environment of each country possible for the market
entrance for the future overseas market entrance of Long-Life
Housing.
Therefore, this study aims to analyze the external
environment of each country expected to be possible for the
entrance of Long-Life Housing based on the groups of
markets possible for entrance drawn from many countries that
will lead the international house construction market through
CAGE analysis and the list of top countries where Korean
construction industry is already active. And the result is
purposed to be utilized as one of data to determine for the
overseas market entrance of Long-Life Housing in the future.
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2. Scope and Methods of the Study
The study’s scope is set to the finding of external
environment of each country expected to be possible for the
entrance of Long-Life Housing based on the groups of
markets possible for entrance drawn from many countries that
will lead the international house construction market through
CAGE analysis and the list of top countries where Korean
construction industry is already active. As the research
method to select countries possible for the entrance, CAGE
analysis and the list of top countries where Korean
construction industry is already active are used.
First, 44 countries are classified into 5 market groups on
the quadrants with the two coordinate axes (population,
economy) drawn from CAGE analysis. Second, 10 top
countries where Korean construction industry has entered are
drawn with 654 cases of international construction
performance selected with keywords related to ‘new city and
house’ from 6400 performance reports of International
Contractors Association. Third, the external environments
that may influence to the entrance of Long-Life Housing of 5
countries of the 10 selected countries are analyzed.
For the data on the external environment of the countries
with market entrance possibility, on and offline documents in
Korea and interviews with experts and oversea residency
experienced persons have been collected as the spatial portion,
and, as the temporal, the related data limited to the recent two
years have been collected to find the most updated trend.
II. Previous Literature Study
2.1 Trend of Study on the Overseas Market Entrance of
Korean construction industry
‘Study on Strategies utilizing u-City for the Overseas New
City Market Entrance’ (2007) of KICT sees the u-City
construction projects that have been successively performed
in Korea as a new export products for the current trend that
Korean constructors are increasingly entering overseas
markets due to growths of real-estate and new city
developments in overseas and presents the strategies and
various support measures for the overseas market entrance of
u-City construction. For this, the domestic and overseas
performance status and forecast related to new city and u-City
are analyzed and, based on the analysis result, the guidelines
for the future entrance to the new city development project
utilizing u-City by establishing the basic and detail strategies
are presented. For this, the study covers the analyses of
market, technology and requirements for the practice and the
investigation of expert opinions.
‘Trend of Studies on the International Market Entrance of
Korean Construction Industry’ by Chung, J.(2014) organizes
the previous literatures in websites of Architecture and Urban
Research Institute, Civil Engineering Research Information
Center, National Assembly Library and International
Contractors Association by using the keywords of ‘overseas
market entrance + construction industry or Korean
constructors’ and analyzes research reports, academic theses,
academic presentations and contributions with the major
policies in the same time periods in the perspective that the
trend analyses on temporal researches of overseas market
entrance haven’t been sufficient. According to the analysis
results, research reports and contributions are the ones
showing the relations between the policy status and the
literature keywords. Most literatures present vitalization
measures and competitiveness reinforce measures for the
construction sector as conclusions, yet fail to show major
temporal differences. Especially, while ‘localization’ and
‘local customization’ are frequently mentioned, specific
details are insufficient. The study notes, for the future
overseas entrance strategy researches to vitalize the LongLife Housing distribution, efforts to draw specific images of
‘localization’ or ‘local customization’ are required, and, to
handle the house construction area, the establishment of
selection criteria for the entrance possible countries and the
analyses of each country’s external environment are required.
2,2 Trend of Study on Apartments in China, Southeast Asia
and Middle East by Korean Researchers
Lim, N.’s “Analysis on the Plan Types of Small and
Middle Sized Apartments in Beijing, China” (2012) attempts
to find the compositions and characteristics of small and
middle sized apartments resided or sold in 2009-2012 in
Beijing for the fluent distribution of small and middle sized
apartment planning. The analysis shows, as the characteristics
of unit planning of small and middle sized apartments in Chia,
1) the separation principle between opened and private spaces
is displayed strongly so that the opened area such as the living
room and kitchen are arranged closed to the entrance and bed
rooms are placed inside far from the entrance, but close to
bathrooms. 2) LD-K type is most frequent so that the living
room and the dining space are most opened areas forming
important places where the family is gathered 3) many plans
show the direct connection from the entrance to the living
room.
Hoang, D.’s ‘Comparative Study between the Spatial
Compositions of High-rising Apartments in Vietnam and
Korea’(2011) attempts to find reference data for Korean
architects in designing apartments in Vietnam by evaluating
the differences found from the analysis and comparison
between the spatial compositions of high-rising apartments in
Vietnam and Korea. Through the literary, drawing and
questionnaire investigations, the study presents the
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irrationalities and advantages in Korean apartment plans for
Vietnamese market based on the comparison and analysis
results.
“Study on the Guideline Development of Unit Plan for
Iraqi Apartments Applying the Pattern Language of
Christopher Alexander” (2014) by Choi, J. currently
performing the national policy research of “Development of
Construction Prototype of each Local for the Overseas
Market Entrance of Apartment Industry” addresses the facts
that Iraqi government actively promotes the apartment
construction to increase the housing rate (while international
contractors perform contracts, Korean constructors are still
considering the entrance in the country) and Korean
researches are lacked on the apartment plan reflecting the
residential culture of Iraq. The study proves that planning in
new residential formation reflecting the local residential
culture is possible by classifying the residential culture that
should be considered when planning the residential space in
Iraq through the pattern language into 4 categories, Protection
of Visual Privacy, Climate Characteristics, Spatial
Composition of Iraqi Houses, Size and Characteristics of
Iraqi Family. Total 34 patterns are selected from the pattern
language to apply Iraqi residential culture in the apartment
unit plan. Based on the 34 selected patterns, the study
presents the guidelines for plans of the space composition,
formation, entrance, external wall and window and external
space for the apartment unit.
III. Selection of the Entrance Possible Countries
for Long-Life Housing
3.1 Entrance Possible Market Group Selection through
CAGE Analysis
CAGE framework is selected as the base for the overseas
market entrance of Long-Life Housing.
CAGE is the abbreviation of Cultural, Administrative,
Geographic and Economic differences and is a practically and
frequently used measure to analyze the limits in the overseas
market entrance and identify countries relatively easy for the
entrance based on the differences in culture, administration
(politics), geography and economy.
This study uses CAGE to draw the entrance possible
market groups based on the administrative, geographical and
cultural factors by classifying markets in details focusing on
the economic and demographic elements on the house
markets.
Data from UN and its organizations, OECD and IMF are
utilized for the objective comparison between countries.
Based on the general fact that countries having more
population, higher population growth rate and higher national
economic power (the national GDP, GDP growth, GDP per
3
capita), the attraction of house market of each country in the
world are measured with the population and economy
variables. Then the market groups of possible entrance are
divided largely as the followings.
observed before the entrance for Korean as well as any
overseas construction industry.
Fig. 2. Entrance Possible Market Groups based on
Population & Economy Variables
Fig. 1. Population & Economy Factors based on the
Characteristics of House Market
Population Promising Market (I) represents markets where
the economic power of each individual national is insufficient,
yet the large scaled complexes including new cities can be
established in the future according to the urbanization plans
backed by the rapid population growth. While the economic
scale is insufficient, the markets are expected for high
population growths forming high possibilities on the future
new city developments. Therefore, the markets can be
evaluated to be proper for the entrance of Korean
construction industry.
Advanced Market (II) has been initially determined
somewhat ambiguous to enter for Korean construction
industry since the local and advanced countries’ constructors
are already in play while the both scale and the purchasing
power of the house market is established. Such scene seems
to be formed because Advanced Market combines two
different characteristics of matured market that is already
matured showing the slowness in the population and
economy growths and of emerging market that is expected for
the future growth based on the certain scales of population
and economy. Economy Promising Market(III) has high
demands for new house development or house replacement
due to the continuous economy growth in the future despite
the insufficient population or population growth. Therefore,
the market is determined to be easy for the entrance of
Korean construction industry as Population Promising Market.
Immature Market (IV) includes the markets of countries
difficult for the forecast on any short-term growth of house
market due to the still insufficient economy and population
factors, but possible for the entrance due to the future change
in the market environment or policy factors. Since the
population and economy are still weak, the market should be
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3.2 Selection of Top 10 Korean Constructors Entered
Countries
To find countries available for the entrance of Long-Life
Housing among the countries where Korean constructors are
already in play, reported data including keywords of ‘new
city, apartment, housing, residential and commercial
complex’ have been searched in 6,400 performance reports of
International Contractors Association (2.4.1990~1224, 2013).
Residential, City and Others are selected for the large
classification and the detail classifications of each large
classification are set. The detail categories include House,
Apartment, Combined Facility, Residential Complex,
Combined Residential Complex and Small Apartment for
Residential Category, New City, City Development, City
Plan, New Town, New Capital and City Improvement for
City Category, and Hotel, Lodge, Resort, Condo, Dormitory,
Residence, Officetel for Others Category.
According to the classifications of “Residential, City,
Others”, total 654 cases of overseas construction
performances including 318 cases for Residential, 143 cases
for City and 192 cases for Others are selected.
The organization according to the order of entrance
frequency on country shows the order of Vietnam, Libya,
China, Algeria, Arab Emirates, Saudi Arabia, Kazakhstan,
Angola, Iraq and Singapore.
Table 1. Top 10 Entered Countries
3.3 Selection of Entrance Possible Candidate Countries
(Group)
By organizing lists of the countries included in the entrance
target market group drawn by CAGE Analysis of 3.1 and
entered countries of 3.2, candidate groups of entrance
possible countries are selected as the following figure. For the
additional selection of entrance possible market group in
Advance Market, the categorization is performed as Matured
Market and Emerging Promising Market. Matured Market is
mostly composed of advanced countries having large
economic scaled and stabled population growth. Emerging
Promising Market is composed of countries having smaller
economic scales compared to mature countries, yet allowing
the market entrance due to the population growth.
Matured Market is already advanced for the house market
as the countries already completed the development and
evaluation of Long-Life Housing technology showing
differences with other market groups for entrance and,
therefore, is excluded from this study.
Fig.3. Selection Process of Candidate Groups
of Entrance Possible Countries
From 9 countries included in Emerging Promising Market
(II) Group, China and Saudi Arabia are selected as the
countries available for the entrance of Long-Life Housing
while Vietnam is selected from 8 countries included in
Population Promising Market (I) Group.
And, from 9 countries included in Economy Promising
Market (III) Group, UAE and Singapore are selected while
Kazakhstan, Iraq and Algeria are selected from 10 countries
included in Immature Market (IV) Group.
From these selections, the external environments of
countries (China, Vietnam, UAE) seem most promising in the
three market groups excluding Immature (Observing) Market
are investigated in this study.
East Russia is additionally included in the countries for the
external environment investigation because expert opinions
that East Russia is slow in the development unlike West
Russia while the apartment market is expending recently is
applied.
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Fig.4. Entrance Possible Candidate Group Selection (Red Colored)
IV. External Environment Analysis of each
Entrance Possible Candidate Country
4.1 China
1) Opportunity Factors
GDP per capita passed 5,000 USD in 2011, China soon
will become a middle power. The urbanization rate of China
currently is 54%(WB2014) in the similar level of Korea in
early 1990s. Chinese government has established the
Urbanization Promotion and Healthy Development Plans
(2011-2020) to drive the urbanization rate to 60% or higher
by 2020 and plans to invest 40 trillion CNY(7,200 trillion
KRW) for the urban construction and the low income housing
until 2020. Especially, Xi Jinping administration has selected
the domestic consumption stimulation through the
urbanization as the new growth engine. Also, Chinese
government has established New City Development Policy
and shows its interests in the high-level know-how from new
city developments (Bundang, Ilsan and others) in Korea.
Currently, Korean construction industry entered in China
market, the largest in the world (1.6 billion population and
wide land of 9,596,961 ㎢) in later part of 1990 and is
positioned at No. 10 with approx. 670 construction contracts
in amount of 1.34 billion USD showing very low record
compared to the trading amount between two countries.
Recently, Korean styled apartments are under construction in
larger cities due to the ‘Korean wave’ influence. However,
Korean contractor entrance in the market is insignificant.
After joining WTO, the house pricing of China maintains
the growth trend continually despite the government’s
suppression policy. China, despite its socialist system,
recognizes the house as a permanent private property by
enforcing Material Right Law (March, 2007).
Some apartments in China are called as Máopīfáng(毛坯房,
Unfinished) and Jingjuwangfáng(精裝房, Basic Interior).
Since such apartments are similar to Korean Long-Life
Housing, some similar markets for the entrance of Long-Life
Housing is considered to exist.
5
China holds Korea-China Cooperation Conference in City
and House Areas (9th Event, 2012) joint with Korea. MOU
between the two nations on the sustainable urban
development area has been entered (2013) and Korea-China
FTA will be activated from 2015.
2) Threat Factors
No.1 country in the international construction contract
China has 5 of top 10 largest constructors in the world.
Although the construction industry is vitalized due to its
extensive urbanization policy in the country, only the big
picture on the urban construction has been drawn (2010).
China is a socialist nation so that closed tendency is
appeared. And, the unique culture called as ‘Guanxi’ existing
in China is considered to become a barrier for foreign
constructors including Korean companies.
Since domestic constructors possess the basic technology
while maintaining low pricing, the domestic constructors are
evaluated to have high possibilities to be advantageous in
competitions with Korean companies.
4.2 Vietnam
1) Opportunity Factors
Currently having GDP per capita of approx. 1,700 KRW
(GDP of 144.6 USD), Vietnam shows rapid population
increase led by Hanoi, Ho Chi Minh City and other major
cities. The urbanization rate of Vietnam is 33% (WB2014)
while the housing distribution rate based on western style
apartments is approx. 10% (KOTRA).
The housing shortage is severe so that Vietnamese
government has established to supply social houses in priority
in the national level and is performing 124 construction
projects in nationwide. Therefore, the country is evaluated to
have high possibility for the development in the future 20
years. Additional, the supply of apartments for higher classes
and foreigners are performed mostly in large cities (Hanoi,
Ho Chi Minh City). Such apartments under constructions in
Vietnam are in the column structure having high ceiling
heights with minimum interior finishing. It has been
confirmed that the recent Hanllyu influence is increasing the
attention to Korean style apartments in Vietnam as well.
Vietnamese prefer apartments in small buildings over the
other types in large scaled buildings. The reason of such
residential preference seem to be based on the impossible
activities of resident in the apartment to change the internal
space arrangement and even the outer wall considering Feng
Shui and the fortune of each individual resident in the
apartments in large scaled building while such action is
possible in the apartments in smaller scaled buildings.
In Vietnam, Korean, Chinese and Japanese constructors
are active. It has been investigated that Chinese constructors
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are suffering from influences of anti-Chinese demonstration
(the land dispute between Vietnam and China, May, 2014)
and Chinese action prohibiting new investment in Vietnam
(Retaliation for the dispute, Jun., 2014) and Japanese
constructors are highly interested more in the railway/road
construction than the apartment construction.
Vietnamese government’s action of ‘Mitigation of
Condition’s for Foreigner’s House Purchase’ (Feb., 2014) is
revitalizing the real-estate market. Vietnam is under the
cooperation relation and is a FTA signed country with Korea.
2) Threat Factors
In Vietnam, as in China, the Political Bureau of the
Communist Party possess the full authority on the entire
determination, but the politic is stabilized. Different from
other Southeast Asian countries under Indian culture
influence, Vietnam belongs to Chinese Character Culture so
that many Chinese constructors have entered in the market.
The technology of domestic constructor have reached to a
certain level and are classified to be more advantageous than
Korean companies in terms of pricing competition.
Therefore, some expert opinions note that the market
entrance of Infill manufacturers would be more promising
than that of constitution companies for Korean construction
industry because Vietnamese part manufacturers are still in
weaker positions.
4.3 Arab Emirates (UAE)
1) Opportunity Factors
UAE consisting of seven emirate states is known as global
oil producer GDP per Capita is 44,771USD (2014, IMF) with
the urbanization rate of 84.4%(2011). According to BMI, a
market research expert institution, the scale of construction
industry of UAE in 2014 is approx.. 3.9 billion USD showing
5.5% growth against the previous year’s and taking 9.1 % of
UAE’s GDP. Abu Dhabi and Dubai take the major portion
respectively 53% and 46% in the scale of UAE construction
industry as positing at the center of UAE’s construction boom.
And the real-estate portion including housing and commercial
buildings takes 58% of entire scale of construction industry.
According to IMF’s estimation, the population will become
6 million in 2015 from 2010’s 5.4 million due to the increase
of foreigners’ inflow so that residential and commercial
spaces are expected to be increase to accommodate such
population. Therefore, real-estate and infra related projects
under the government’s administration are expected
continuously offered. Various housing projects are performed
in Abu Dhabi and Dubai respectively based on Plan Abu
Dhabi 2030: Urban Structure Framework Plan (central city
development plan) and Dubai Strategic Plan 2015 (Dubai
Economic
Development
Plan).
Additionally,
city
development projects for the northern Emirates (Sharjah,
Ajman, Ras Al Khaimah, Umm al-Quwain, Fujairah) behind
in development compared to Dubai and Abu Dhabi are also
actively performed. The plan to construct adequately priced
apartments(affordable housing) for low income foreign
workers has been announced, and, currently, the housing
establishment in the scale to accommodate 380 thousand
workers is under the progression. Also, UAE government is
performing various housing related supporting projects such
as Zayed Housing Programme for the life stability through
continuous house supplies as a part of efforts to improve the
life environment of its citizens.
As demands of the real-estate and the construction industry
are increasing, Dubai government promotes the
environment-friendly and green economy.
2) Threat Factors
Middle East countries consider the local construction
performance important. And, the performance records in
various construction projects are required to secure
opportunities and competitiveness to participate in the future
large scaled projects or the projects in other Middle East
countries. The scale of general construction project is smaller
than other oil or gas plant project and generates insignificant
return against the investment. However, in the long-term
perspective, such small scaled construction can be considered
as an opportunity for a constructer entering Middle East
construction market for the first time. However, the local
constructors show the advantage in the contract for general
construction projects so that the single contract by a Korean
constructor is, in fact, difficult. Therefore, it is expected that
various business cooperation through the joint participation
with a local constructor, the establishment of local company
or the continuous network with a local company is required.
Recently, not only U.K., but China, Japan and other many
countries anticipate the active contract wining in projects
through the government guarantees. Since UAE, especially
Dubai significantly welcomes such actions so that actual
achievements are resulted. Financing through not
governments, but private institutions seems very active so
that various projects are contracted by presenting long-term
guarantees as the conditions.
Dubai had been maintaining Zone 2A Seismic Code Policy
although the country is safe from earthquakes. However, after
the large scaled earthquakes in Iran, Pakistan and other places,
the country conditionally raised the policy up to Zone 2B.
Since the determination is made without any announce on the
enforcement, the industry is facing confusions. And,
especially, since the determination is applied to the buildings
currently under constructions, issues to re-design and
re-analyze and to supply new construction material (seismic
APNHR April 2015
endurance) are faced. Any Korean company ether in
performing or attempting to promote construction project in
Dubai should acquire accurate understanding on and prepare
for Dubai’s seismic code in advance.
In general, the housing of UAE is in the single house type,
not in the apartment type due to the country’s vast land. Each
housing is large in the area of 496 m2 or larger and is
provided for free so that the entrance of Long-Life Housing is
expected to be difficult.
4.4 East Russia (Khabarovsk)
1) Opportunity Factors
Russia, the world no. 9 country with GDP of 2 trillion and
57.3 billion USD(as of 2014, IMF) shows a great deal of
differences between the West already developed and the East
still in need of development. The urbanization rate of Russia
is 73.8%(2011). This study is limited to Khabarovsk in East
Russia. The country shows the severe differences between the
rich and poor and high prices. However, the wage is low.
Russian use their wages for the living cost only without
savings. Since the education and the medical are free so that
the low wage is not much of problem in living. People shows
no desire to increase the wealth and want relaxed lifestyles.
With the land provided as the long-term rent for 50 years,
complete process from the design to the sales can be
performed. For private housing constructions, sales price
fluctuation is applied and the sales includes the concept of
construction investment partnership. Since the financing
system is insufficient, the construction is performed with the
payments of future residents. Therefore, the construction
period is very extensive and the characteristic that the sales
rate increases right before the completion is displayed. In
general, apartments in 5-10 floor buildings are supplied to
public officers and soldiers for free. Since the apartments are
inherited to children so that the desire for the ownership or
invest for housing is rather low and the characteristic of
long-term stay in the same location is shown as well. For the
local apartments, the constructor completes only the structure
and outer wall and the resident directly complete the interior
wall and finishing by purchasing desired materials. Upper
income class prefers European materials and low and middle
income classes use Chinese materials.
Other than local constructors, almost no competitor exists.
Although some Chinese constructors appear in the market,
the credibility of Korean constructors completing within the
proposed period is highly evaluated.
2) Threat Factors
Since the global standard (the US technology standard) is
not applied, but partially improved old Soviet standards are
applied, materials and equipments are frequently supplied
7
from the local market. Especially, Insulation, Moisture,
Structure standards, fire, evacuation, ventilation standards and
sunlight and setback regulations are very strong.
Due to the Russian characteristics with no purchases of
middle classed materials between the expensive European
and Japanese materials and the cheap Chinese materials, the
export of Korean materials is very difficult.
V. Conclusion
This study selects the candidate countries shown to be
possible for the entrance of Long-Life Housing through the
comparisons of top 10 countries in the countries of entrance
possible market groups drawn in the population and economy
aspects and the list of countries where Korean constructors
already entered in the house and city areas. Then, the
opportunity factors and threat factors for the entrance of
Long-Life Housing in each countries are studied. The results
from such activities are as followings:
First, based on the general fact that countries having more
population, higher population growth rate and higher national
economic power (the national GDP, GDP growth, GDP per
capita), the attraction of house market of each countries in the
world are measured with the population and economy
variables and the entrance possible market groups are
classified as Population Promising Market(8 countries),
Advanced Market(Emerging Promising Market including 8
countries, Matured Market including 9 countries), Economy
Promising Market(9 countries) and Immature Market(10
countries).
Second, top countries where Korean construction industry
already entered in the house and city areas are Vietnam,
Libya, China, Algeria, UAE, Saudi Arabia, Kazakhstan,
Angola, Iraq and Singapore. Vietnam in Population
Promising Market, UAE and Singapore in Economy
Promising Market and China and Saudi Arabia in Emerging
Promising Market are selected as the entrance possible
candidate countries by comparing the countries in the
entrance possible market group. Kazakhstan, Iraq and Algeria
are selected in Immature Market, but excluded from the study
scope.
Third, the results of finding the opportunity factors and
threat factors on the entrance of Long-Life Housing in 4
countries including Vietnam, UAE and China drawn in the
market groups and Khabarovsk, East Russia drawn from the
interview investigation are as followings: 1) All 4 countries
are where the house demand is increasing or are expected for
the future demand increase, and, excluding UAE, apartments
are generalized in those countries. 2) The common features of
apartments in the 3 countries except UAE are either the
column or combined type and the built-ins are completed by
8
APNHR April 2015
residents as being separated from the building. 3) Vietnam
and China are in common as being systematically opened for
the entrance due to the inter-government agreements or
conventions. As the threat factors 1) Social nations (China,
Vietnam and East Russia) or closed country for foreign
companies (UAE) make the entrance for foreign companies
difficult to enter, 2) Limits exist on the quality and pricing to
compete against the already entered foreign constructors or
local companies.
Although some points that the overseas market entrance of
Long-Life Housing is too early, the result of this study
confirms that the external environments making the entrance
possible are formed in various places in the world where the
scale of house market is significant and construction
companies from advanced counties are in fierce competitions
to preoccupy the house market. On the other hands, Korean
constructors are found to be insignificant in the international
house market because the constructors prioritize the profit
and focuses in the plant construction and Middle East areas.
Though the external environment allowing the entrance is
formed, the threat factors exist. Therefore, Korean
construction industry should be in hurry for the entrance
while reviewing in detail on the local information. Also, like
many countries in the world making efforts for the overseas
market entrance of own national construction industry,
Korean government should deeply consider to establish
support policies to provide more power for Korean
construction industry before it’s too late.
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