Dynamic Relationships between Mega Projects and Official Development Assistance: Case of South Korean Infrastructure Construction Projects in ASEAN’s Developing Countries

Suk-Won Lee and Jae-Keun Jeon
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Suk-Won Lee: Seoul Housing & Communities Corporation, 621, Gaepo-ro, Gangnam-gu, Seoul 06336, Korea
Jae-Keun Jeon: Korea Institute of S&T Evaluation and Planning, 68, Mabang-ro, Seocho-gu, Seoul 06775, Korea

Sustainability, 2018, vol. 10, issue 12, 1-22

Abstract: In developing countries, infrastructure construction projects are sometimes recognized as mega projects that are important for national development. Such projects are usually implemented as official development assistance (ODA). However, the correlation between the size of ODA and the infrastructure construction project orders gained cannot be completely confirmed. South Korea gives constant aid to developing countries and increases the budget of ODA simultaneously in order to select which country’s construction market to advance. The largest portion of South Korea’s aid continues to be provided to Asian countries. This study analyzes the dynamic relationship between South Korea’s ODA to the Association of Southeast Asian Nations (ASEAN) developing countries and the economic fluctuations represented by infrastructure construction projects, gross domestic product (GDP), gross national income (GNI), and foreign direct investment (FDI). The analysis result shows that the scale of ODA is synergistic to the number of infrastructure construction project orders awarded. In other words, as ODA increases, developing countries can continue to construct infrastructure, and South Korean companies can improve their performance in overseas construction projects in cooperation with those countries. The results of this study can be used as basic data for the decision-making of donor countries when selecting a country’s construction market to advance.

Keywords: mega project; official development assistance; infrastructure construction project; developing country; economic fluctuation; vector error correction model (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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