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Korea Report – February 2006

Author : Hwang & Co Date : 06-03-08 10:55 Hit : 37162

Topics.

- FTA talks between Korea and USA started amid protests by movie makers and farmers.
- A half-Korean football player drew attention to discrimination of mixed parentage children.
- Korean foreign minister to run for UN’s secretary general.
- Vatican appointed Nicholas Cheong Jin-suk as another Korean cardinal.
- KEB joined the sanction against NK-Macau Bank connection.
- Lotte Group argues with Air Force for the construction of 112 story building.
- Local banks recorded surprise earning.
- Lone Star started the move to sell KEB.
- Korean Corporates focus to secure energy and natural resources over the world.
- Overseas plant and construction orders hit records due to Mid East boom.
- Carl Icahn moves to acquire KT&G.
- Samsung Group donated KW800 bil to atone its corporate controversy.
- BOK raised its bench mark rate to 4%.
- Kwon and CSR governed the future price of ships.
- Korean shipbuilders increase their import of Chinese steel plate.
- DSME management reshuffled.
- Hanjin started to build its shipyard in Subic Bay.

GOVERNMENT AND POLICY

Korea and USA, whose bilateral trade valued at $72 bil in 2005, decided to enter free trade negotiations, paving the way for Korea's first FTA with a major economy. Once Korea-US FTA takes effect, both countries are expected to expand their tariff-free trade items by more than 90% throughout a 10-year span. Seoul agreed to reduce the film quota of Korean movies by half to 73 days from current 146 days, as it was one of 2 major preconditions proposed by USA for entering the negotiations. Another one is the lifting of ban on American beef imports.
Both countries are scheduled to begin formal negotiations on FTA in May, hoping to wrap up the agreement within a year. In Asia, USA has FTA with Singapore and Australia, and negotiates with Thailand under way. Korea currently has an FTA with Chile and signed with Singapore and the European FT Association.
Since Korean government decided to reduce to show domestic films in local theatre for 73 days from current 146 days a year from coming July 1, thousands from the Korean filmmaking community held a massive rally against the plan, which was followed by a series of one-man demonstrations staged by top directors, actors and glamorous actresses. In recent years, Korean films are dominating the box office, carving out more than 50% market share, and government officials argue the local movie industry is now strong enough to compete with foreign movies without the protective system. The Culture Ministry announced a plan to raise KW400 bil over 5 years to support the local film industry, but filmmakers remain unimpressed. Korea’s Agriculture Minister promised not to include the liberalization of rice and beef imports in the agenda of upcoming FTA talks with the USA, amid fierce protest from farmers who feared losing competitiveness with greater market access.

The government’s Board of Audit and Inspection concluded that disgraced Prof Hwang Woo-suk misappropriated KW6.2 bil in research funds. The once star scientist has spent KW31 - KW37 bil of state funds and KW6 bil of private donations. Professor Hwang claimed the money was used for labor costs for the researchers and others, but with no proof to the BAI.
The prosecution has asked Prof Gerald Schatten, a former partner of scientist Hwang, to come to Korea for questioning over the stem-cell scandal. Schatten is currently undergoing a separate investigation by his school in USA. Schatten played a leading role in writing the 2005 paper based on false data sent by Hwang's colleagues. Park Jong-hyuk, a researcher sent by Hwang to Schatten's lab, will also be questioned for the 2004 paper on alleged manipulation when he returns to Korea.

The presidents of Korea and India agreed in Seoul to start negotiating on a treaty for a comprehensive economic partnership, enhancing technological cooperation. The agreement applies to a FTA as well as exchanges in services, investment and others, aiming to complete the negotiations by 2007.
Korea and Ukraine has signed a visa waiver agreement, allowing SKoreans to visit Ukraine for up to 90 days without a visa. Japanese government decided to waive visa on Koreans’ short term visit for sightseeing and business purposes from March. Singapore has extended the period of temporary stay for Korean visitors from the current 30 days to 90 days, starting March 2 when the FTA between 2 countries takes effect, which was signed in Aug 2004.

Foreign Minister Ban Ki-moon announced his candidacy to become the next United Nation’s secretary general, as the first Korean to run for the post. With the next secretary general likely to come from an Asian country under the customary regional rotation, a Sri Lankan diplomat and Thai Deputy PM declared their own candidacy. The secretary general is picked after earning approval from at least 9 countries of the 15 members of the UN Security Council. 5 permanent members can veto a candidate. After Security Council approval the final candidate is put before the General Assembly, where the final vote is usually replaced by a round of applause. No Asian has headed the UN since U Thant of Myanmar more than 30 years ago.

The New York Times criticized Japan’s new foreign minister in an editorial for making what it called “inflammatory statements” about Japan’s history that were offensive to other Asian countries. It said Taro Aso was also doing a disservice to the people of Japan where public discourse and school textbooks “have never properly come to terms with the country’s responsibility” for its militaristic past that resulted in the sexual enslavement of Korean women, biological warfare experiments on Chinese prisoners, and the slaughter of hundreds of thousands of Chinese civilians in the city of Nanjing, being neither honest nor wise in his statements about Japan’s disastrous era of militarism, colonialism and war.

The Vatican appointed Nicholas Cheong Jin-suk, archbishop of Seoul, 75, as another Korean cardinal, when Pope Benedict XVI named his first batch of cardinals.
The Pittsburgh Steeler’s half-Korean receiver Hines Ward was featured on the front page of every SKorean newspaper after team’s 21-10 victory in Super Bowl over the Seattle Seahawks. Born to an African-American father and Korean mother, Ward’s story is also drawing renewed attention to discrimination faced by children of mixed parentage in SKorea, where the conservative culture places a strong emphasis on pure blood ties. Ward has credited his mother’s work ethic for teaching him what it takes to succeed. Many people have said it was for the best that he was raised abroad because a mixed-race child would have likely faced a life-time of discrimination in Korea.

Korea’s Ahn Hyun-soo and Jin Sun-yu, kings and queens of short track skating were responsible for all of Korea’s 6 Winter Olympic golds in Turin, earning 3 each. The Koreans, with six golds and 11 medals in all, were seventh in the medals table on the final day.
Korean Charlie Wi, 34, sealed a victory of EPGA tour in the Malaysian Open, finishing at 19 under par, one stroke ahead of Thailand’s Thongchai Jaidee.
Kim Joo-mi, 21, holed a 2-foot birdie putt on the second sudden-death playoff hole to defeat fellow Korean Moon Soo-young in the LPGA Tour’s season-opening SBS Open, finishing with a 10-under 206 total to earn her first LPGA Tour victory. Korea’s Meena Lee triumphed over compatriot Lee Seon-hwa at the LPGA Fields Open, second LPGA Tour this year, finishing 14 under 202, while Michelle Wie was one shot shy of making the playoff that Meena Lee won on the third extra hole. First 2 LPGA tour were swept by Korean girls.

Seoul Metropolitan Government plans to spend around KW7.6 tril on expanding cultural facilities over the next 10 years, including establishment of new arts and performance centers, promotion of cultural industries and recovery of historic relics. Seoul has often been criticized for lagging behind other foreign capitals in terms of cultural content and facilities.
Korea and France agreed in Paris to digitalize the books stolen by French soldiers some 140 years ago. They will produce a CD, containing books published during the Chosun Dynasty (1392-1910). 2 countries must still reach agreement on whether the books currently stored in the French National Library could be returned to Korea.

NORTH KOREA AND NATIONAL DEFENSE

Korea Exchange Bank had terminated all transactions with Banco Delta Asia, accused by Washington of laundering money for NK, becoming the first SKorean financial institution to join US-imposed sanctions against the Macau-based bank. NK was accused to pocket up to $1 bil a year from counterfeiting US greenbacks, trafficking illicit narcotics, smuggling contraband cigarettes and even peddling fake sexual aid drugs for men, with the money handling through the Macau bank.

NKorea and Japan began their five-day normalization talks in Beijing, their first high-level meeting in 3 years. Japan made the abduction issue a top priority. In 2001, Japanese PM and NK’s leader moved to speed up the normalization talks and tackled with the matter as Japan insisted the abduction issue be resolved ahead of discussing other pending issues. NK admitted that its agents kidnapped 13 Japanese nationals in the 1970s and 1980s for insight into Japanese language and culture. Pyongyang released 5 abductees to their home as part of efforts to continue talks with Tokyo, claiming the other 8 were already dead. However, Japan still insists some of the unreturned are still alive and has demanded NK to provide convincing evidence for the alleged deaths, urging to take full investigation into other suspected kidnappings. On the other hand, Pyongyang has demanded Tokyo provide reparations for Japanese colonial rule over the Korean Peninsula from 1910-45.

Trade between NK and China reached a record high of $1.58 bil in 2005 up 14.8% on year, due to improved bilateral political and economic ties. Trade between South and North Korea jumped 51.5% on year to $1.06 bil in 2005, while the North’s trade with Japan was down 22.9% to $139 mil.
SKorea shipped 6,000 tons, its first batch of 150,000 tons Seoul has agreed to provide for NK’s spring crop. NK has been requesting for about 300,000 tons of fertilizer to the South for the past 7 years. Last year, a total of 350,000 tons were sent and NK was said to request a total of 450,000 tons for this year.

The Air Force opposed Lotte Group's plan to build a 112 story building as part of a large scale amusement park project in southern Seoul, citing the building is inappropriate because it may endanger the safety of flights. Lotte Group has pursued the KW1 tril project since 1994 to construct a 87,400 sqm amusement park called the 2nd Lotte World in Jamsil, including the 555 meter high building housing a department store, hotel and offices. After a series of consultations in 2003, 3 parties, such as Air Force, Lotte Group and Seoul Metropolitan Government agreed to ask the US Federal Aviation Authority to give their advice on aircraft safety. In 2004 the FAA replied the building would require the Air Force to change the procedures related to instrument landings in the area. The final decision will be made by a special sub committee by city government.

ECONOMY AND POLICY

The government and the central bank project the economy to expand 5% this year, compared to last year's 4%. Government forecasted that Korea’s growth rate likely to decelerate to 4.3% in 2010, falling further to 3.1% in 2020. The country's GDP would reach $2 tril in 2016 and $3 tril by 2020 to lift Korea as the world’s ninth largest economy, from current 11th. Per capita GDP is predicted to achieve $20,000 by 2008, and to fly past $50,000 by 2020.

Korea’s export rose 17.4% on year in Feb, back to double-digit growth, to $239.6 bil, attributing to an increase in demand of major export items, such as semiconductors, cars, auto parts and machinery, compared with a 3.8% growth in Jan. Imports rose 27.3% to $234.2 bil, posting the trade surplus at $540 mil in Feb. China shipped 6.46 mil metric tons of its steel products to Korea in 2005, increasing 3.5 fold from 2003. 54% of China's export volume of hot rolled steel sheets, 60% of H beams and 40.5% of thick plates were shipped to Korea.
The nation's chronic deficit on the nontrade account hit an all time high of $26.23 bil in 2005, fueled mainly by Koreans' increasing overseas tourism, compared with $18.3 bil in 2004 and $15.97 bil in 2003. USA recorded a $1.1 bil trade deficit with Korea in Dec, bringing the tentative yearly deficit in 2005 to $16.1 bil.

Local banks’ combined earnings amounted to an estimated KW13.4 tril in 2005, up 52.4% on year. Bad loans fell to KW5.2 tril from KW9.6 tril in 2004 after the banks implemented a more sophisticated risk management system. The increase in net profits was largely generated from non-operating income and a decline in provisional expenses. While local banks are striving to bolster their non-interest operations, the nation's top lenders are also seeking to expand through mergers and acquisitions. Kookmin and Hana Bank are vying to acquire Korea Exchange Bank.

The Industrial Bank of Korea and Korea Development Bank, 2 major contributors to Small and Medium Enterprises, decided to provide a combined KW30 tril of funds, and KOEXIM Bank an additional KW4.5 tril for exporters, this year. The SME sector accounts for about 87% of Korea's total hiring and 50% of factory output, but investment by the sector shrank 20% in 2005 on year, as the non-bluechip companies remain the softest spots in the economy.
The government is to invest KW130.9 bil this year to help local digital content makers enhance their global competitiveness. The industry forecasts to grow an annual average of 13% to KW11 tril in 2007 and KW15 tril in 2010, helped by brisk sales of online games and new mobile services such as digital multimedia broadcasting.

Lone Star, who holds a controlling 51% stake in Korea Exchange Bank, Korea’s fifth largest lender, is trying to sell after a two-year lockup period ended last year. Top lenders such as Kookmin Bank and Hana Financial Group have expressed an intention to bid for the bank. Bidding for the stake is expected to start from the end of March. KEB shares, which Lone Star acquired in Oct 2003 for KW1.38 tril, have presently jumped to KW4.5 tril.
A parliamentary committee approved a request from lawmakers for a probe by the Board of Audit and Inspection into suspicions surrounding the buyout of the KEB by Lone Star. The prosecution has made a progress in a tax evasion probe into Lone Star, while the Financial Supervisory Commission said that there is no legal ground to suspend Lone Star's sale of KEB. If Lone Star is indicted by the prosecution, it faces the possibility of losing its status as the largest shareholder. 2 subsidiaries of Lone Star were accused for illegally transferring over $8.6 mil overseas, by paying commission for consulting they never received.
Macquarie Bank, Australia’s largest investment bank, plans to spend as much as $1 bil this year on investments in Korea. Key targets include media and energy businesses, with the assets injected into current or future funds.

The government may remove all restrictions on overseas property purchases by next year after moving up its schedule to liberalize foreign currency transactions, as the second phase of the plans to fully liberalize all foreign currency transactions by 2011. By lifting currency regulations, Seoul hopes to slash KWon value, which has appreciated around 4% against USDollar so far this year, compared to 2.4% increase in 2005..

Korea’s energy imports increased 33.5% on year to $66.7 bil in 2005, accounting for 25.5% of the country’s total imports of $261.2 bil for the year, as the price of crude oil rose 39.2%, and LNG and coal prices jumped 28.7% and 28.2%, respectively from 2004.
OAO Rosneft, Russia’s state-owned oil company, expects to discover the assumed deposits of 900 mil tons of oil and gas, in off-shore fields in the northern Pacific, exploring with a group of Korean companies, including Korea National Oil Corp, KOGAS, SK Corp, GS Caltx Corp, Daewoo International, Kumho Petrochemical and Hyundai Corp, which holds 40% stake in the project, investing about $150 mil to explore the fields in the next 2 years.
KOGAS, the world’s biggest buyer of LNG, plans to limit increases in fuel costs that jumped 28% last year by boosting cooperation with purchasers in other countries, such as increasing swaps of cargoes with other buyers, expanding LNG storage capacity and seeking more flexible supply contracts to help with the “severe seasonality” of Korea’s LNG demand.
Korea Resources Corp and SK Networks, the trading arm of SK Group, won exploration rights to mine lead and zinc in China. The Koreans and a Chinese partner will each have a one-third share in the project, which will cost $16 mil in the early development stages.
Korea Oil Corp together with SK Corp confirmed oil and gas of 15-1 field in Vietnam, for estimated reserve with 300 mil barrel of oil and 3-4 tril cu ft of gas. KOC holds 14.25% and SK 9% stake in the project which will start production of 200,000 barrel a day from 2011

CHAEBOL

President Roh suggested the KW800 bil of historic donation, offered by the Samsung Group to atone for its corporate controversy, should go to assisting the disadvantaged to relieve inherited poverty and limited education opportunities. Nearly a month has passed since the group announced its historic donation but no way to use it has been found yet. People believe that the best solution would be for Samsung to take charge of the fund’s management with its unique management know-how, to achieve a much more valuable social contribution than offered unconditionally. The Group also withdrew its lawsuit against fair trade law. It promised to enhance the transparency of management by increasing external directors more than half, assigning the chairman of the board from external director, and providing proper information for external directors to make a proper decision.
Samsung Electronics signed a contract with France’s largest wireless operator Bouygues Telecom, private broadcaster TF1 and broadcasting equipment maker VDL, to supply its terrestrial DMB phones. Terrestrial digital multimedia broadcasting allows the users to enjoy real time TV programs through mobile phones or laptops while on the move.
SEC holds 32.1% share in global DRAM market in 2005, increasing from 30.9% in 2004, staying No 1 position for 14 consecutive years. Hynix kept second with 16.4%, while Micron holds 15.5%, Infinion 12.7% and Elfida 7.1%.
Capital Research & Management purchased 5.0% stake in Hynix for investment purpose.

Overseas plant orders won by Korean builders in Jan hit an all-time monthly high due to strong demand from oil-rich Middle Eastern and African countries. Orders shot up 563% on year to total $3.16 bil, as the oil producing countries are upgrading their industrial infrastructure. The most contracts were for oil and gas facilities, as well as petrochemical factories and refineries. They predict that plant construction orders abroad will hit $18 bil this year, compared with last year's $15.8 bil.
Korean contractors are also enjoying a sharp rise in overseas orders this year, thanks to increased contracts from the Middle East and Southeast Asia, posting $4.55 bil this year, 41.9% of last year’s aggregate orders.
Hyundai Construction plans to arrange a Muslim prayer room in its headquarters by March for its customers from the Middle East. Hyundai won the orders worth of $2.6 bil from Middle East nations of Iran, Kuwait, UAE, Libya and Saudi Arabia, which account for about 30% of the total overseas orders. Daewoo Construction won the order for the pipeline project for Eastern Gas Gathering SystemⅡ in Nigeria, worth $92 mil, in addition to its order for oil and gas production facilities from SPDC of Nigeria in Jan at $875 mil.

Korean car industry regained No 6 position in world car market, by producing 3.7 mil cars in 2005, up 6.6% on year, holding 5.6% share following USA, Japan, Germany and China.
Hyundai Motor (HMC) is to increase its Indian production to 600,000 vehicles per year by 2007. Aiming to command 20% of the local market by 2008, HMC plans to expand its Indian production capacity from the current 280,000 units to 300,000 units this year and to churn out another 300,000 compacts cars from its second plant currently under construction. HMC also plans to export the vehicles produced in the southern Indian city of Chennai to the Middle East, Europe, Central and South America.
HMC will sign a $2 bil contract to supply commercial vehicle kits to Russia, to export its bus and tractor kits in complete knock-down units by 2010. HMC made a contract to export the car worth $600 bil to Algeria, establishing a foothold in African market. It will send total 26,500 units of large and medium size buses and trucks.
HMC cleared 24 years old relation with Mitsubishi. Hyundai Mobis bought 1.04 mil shares and INI Steel purchased 1.27 mil shares held by Mitsubishi, raising their stake to 15.03% and 5.9% stake, respectively. Thus Mitsubish has no stake in HMC.

Since US billionaire investor Carl Icahn bought a 6.6% stake in KT&G Corp, which controls about 75% of the local tobacco market, he has made series of demands to raise the price of the share. Carl Icahn and Warren Lichtenstein as partner requested that the company should spin off its ginseng business and sell idle real estate and demanded 3 seats on KT&G's 12-member board. KT&G acceptd Carl Icahn’s 3 nominees to contest board seats, setting up a month-long battle to secure investors’ support before shareholder’s vote, but openly refused to spin off its real estates and ginseng group, explaining it is not the optimal time for the sales and spin-offs. Icahn and his partners claimed that the company violated the local law by "limiting the number of directorships that may be filled by the Committee at just 2, while the company is guaranteed the election of 4 of its director nominees."
Then US investors offered KW60,000 a share which is currently traded at KW51,200, committing upto $2 bil for the bid, which would effectively increase its stake to 27.1% from 6.6%. KT&G has been vigorously gathering shareholders for a proxy vote to defeat Icahn and his supporters in March. Adding to this latest twist, BOK called for increased legal support to help buffer the corporate sector from hostile overseas buyout attempts. KT&G has hired Lehman Brothers and Goldman Sachs to help defend its managerial control.
Among the foreign investors held 61% of the total shares, Franklin Mutual Advisers has 7.14% stake in KT&G with the close ties to Icahn, and there are other hedge funds with minor stakes in the company, making combined stake of 15.99%, to support Ichan. On the other hand, "KT&G-supportive" stake would be as high as 39.9%, including Korea Industrial Bank’s 5.58%, KT&G employees’ 5.75%, Japan Tobacco Inc 1.76%, other domestic investors 16.64% and the company's own treasury stock of 9.94%.

MONETARY AND ECONOMIC INDICES

KOSPI, Korea’s stock price index, has started the month at 1375, fallen to 1303, threatening 1300 barrier following the slump in New York, then came back to 1374 at the end of the month. Kwon has been stable in the box of 961-970 against USDollar throughout the month. Korea’s foreign exchange reserves declined $9.8 bil at the end of Feb to finish $215.95 bil.
On the back of a stronger-than-expected economic rebound, BOK raised its benchmark overnight call rate by 0.25%, the third hike in 5 months, boosted the policy interest rate to 4% for the first time since July 2003, citing that KWon's steep appreciation against the USDollar, coupled with lofty oil prices, could dampen the economic turnaround. BOK said that the current rate is still below the neutral level and rate hike would not hamper the ongoing economic rebound.
Korea’s jobless rate in Jan fell to 3.4%, the lowest since April 2004, as more people gave up looking for jobs, slipped 0.1% from Dec. Youth unemployment remained a nagging problem as the jobless rate for those aged between 15 to 29 years climbed to 8%, up 0.1% from Dec.
The yield on 3 years corporate bonds was stabilized in the range of 5.38-5.28%.

SHIPBUILDING AND SHIPPING

Korean shipbuilders exported the ships worth $17.6 bil in 2005, up 15% on year, from $15.3 bil in 2004, attributing to the industry’s selective receipt of high value orders. The price of VLCC newbuildings is set to climb, due to a surge of orders coupled with the planned phase out of single hull vessels by 2010, the increasing trade of oil to China and the incorporation of new CSR required by classification societies. Some shipyards predict the price to surpass $150m by the end of this year. 3 major Korean shipbuilders are left with few berths for VLCCs and containerships for 2009, as they have committed at least half of their shipbuilding capacity to LNG projects and. Furthermore, for every 1% of KWon appreciation, the price may be affected by about 0.5%, and CSR is likely resulting in a 4% to 5% rise on the price. On the other hand, many owners are scared to order new VLCC, because, if they order a VLCC at $130m, the vessel would need to earn $50,000 to $55,000 per day for 20 years which no one can guarantee.
Korean shipbuilders swept the global market for LPG carriers last year, raising the combined order backlog to 56 ships capable of containing 3.34 mil cbm of LPG, accounting for 66% of the global total order backlog of 5 mil cbm of LPG.
The negotiation between Korean shipbuilders and Japanese steel mill on the fixing steel prices for the delivery of 2-3 quarter this year hit the deadlock, as Korean requested to lower the price below $500 per ton comparable to Chinese price, but Japanese sticked to $600-680 level.. Japan expects to supply about 2 mil tons of steel out of Korean builders’ requirement of 6 mil tons. POSCO and Dongkook Steel Mill, who suppy about 55% to Korean yards, lowered their price to $610 level, with the indication for further down.
Shinhan Bank decided to enter the refund guarantee market for ship building contract, under the strategic alliance between its corporate financing and Seoul Guarantee Insurance.

HHI Group signed MOU with Baoshan Steel Mill for the annual supply of 180,000 tons of thick plate. HHI decided to import about 17% of its annual requirement of 3 mil tons from China, as the quality of Chinese steel has been improved and prices are more attractive than Japanese. HHI had orders from Eukor Car Carriers for 4 x 6,500 PCTC built at Samho, AMPTC 2+2 x 82K LPG carrier, HMM 2 x 82K LPG and HMM 1 x 6800 TEU container vessel. HMD signed the contract with Cido for 2 x 35K LPG and 5 x 47K MR tanker, Navigazione Montanari 2+2 x 37K PC and Petredec 1 x 22.5K LPG carrier.
DSME received orders from Vela for 6 x 320K VLCC, Kristen Navigation 1 x 320K VLCC, Bluesky 1 x LNG, Odfjell Invest 1+2 x Semi submersible Drillship, and Seadrill 1 x Semi-Submersible Drilling Rig. DSME announced the retirement of Chung Sung-lip as president CEO, together with the sidestep of Ki Won-kang, Kim Ho-chung, Kim Kang-soo and Lim Moon-kyu from their position, as head of division.
SHI secured the order from consortium led by MOL for 1 x 154.8K cbm LNG carrier, Geden Line 2 x 158K tanker, Chandris 2 x 115K tanker, Mosvold 1 x Drillship and Chevron 1 x Offshore gas platform.
STX contracted with Primorsk Shippings for 2+3 x 51K PC, Barclay Shipping 3+2 x 51K PC and Parakou 1 x 51K PC. STX Busan signed the contract with PT Berlian Laju Tanker for 2 x 9K cbm ethylene carrier.
Hanjin Heavy Industries is to build the world’s fourth-biggest shipyard at Subic Bay in Philippine, investing total of $700 mil upto 2016. Hanjin has already secured contract for the new yard in Subic with CMA CGM for 4 x 4300 teu for the delivery 2H/08 – 1H/09.
ShinA got the order from Morfini for 2 x 51K PC/chem. Carrier.
SungDong received the order from Dolco Investment for 4 x 75K PC

Korea ranked 7th on the number of merchant fleet in the world, with 943 ships, while Greece has 2960 units, Japan 2921, Germany 2617, China 2614, USA 1656 and Norway 1589 ships.
Hanjin Shipping plans to place order for 5 units of 10,000 TEU class jumbuo box ships within this year, together with 4 x 4300 TEU class in this spring.
STX Pan Ocean aims to reach sales of $1 bil in tanker operations by 2010 as it took the delivery of its first 2 product carriers built by STX yard and 3 more similar sized ships by next Feb and increase the number of its tankers from the current 14 to 30 by 2010.