Resources-rich Ecuador and technology-powerhouse South Korea are excellent business partners, and the Latin American nation is ready to work with Korean companies in massive development projects and learn from the country's miraculous economic development experience, Ecuador's President Rafael Correa said Friday.
In particular, Correa said that the South Korean conglomerate, SK, is "highly likely" to take part in a US$12.5 billion project to build an oil refinery in Ecuador's coastal province of Manabi, a contract that would mark the company's biggest overseas order.
Correa, who has been on a three-day visit to South Korea, toured SK's r this year, Ecuador awarded SK a $260 million order for a basic engineering study for the project. SK hopes to
also win contracts for later stages of construction.
"I want to emphasize that the economies of the two countries are very complementary to each other," Correa said in an interview with Yonhap News Agency. "South Korea does not have oil, but it has refineries. On the contrary, Ecuador does have oil, but lacks refineries."
Correa, who arrived in South Korea on Wednesday, held summit talks with President Lee Myung-bak, visited refineries and other industrial facilities in the southeastern city of Ulsan and attended a business and investment
seminar. He is the first Ecuadorian president to visit Seoul since 2002.
A former economics scholar, Correa repeatedly praised South Korea for transforming itself from the ashes of the 1950-53 Korean War to one of the
biggest economies in the world, calling South Korea a "case that overturned all economics theories."
"I think that we have a lot to learn from South Korea," Correa said through an interpreter. "After this visit, the admiration that I have had
for South Korea has deepened further ... I was very happy to meet with the main players who realized this economic development."
South Korea and Ecuador established official diplomatic relations in 1962. But their unofficial ties date back to 1950, when the Korean War broke out with North Korea's invasion of the South. Then a member of the U.N. Security Council, Ecuador condemned the invasion and provided supplies to the South.
Ecuador was also the first export destination
of Hyundai Motor, with the No. 1 South Korean automaker selling its first independently developed car, "Pony," to the country in 1976. Hyundai has since grown into one of the world's largest automakers.
Despite the nearly half a century of ties, however, it has been only in recent years that the two countries have been drawn closely to each other, as South Korea seeks business opportunities in the far-flung nation and Ecuador tries to learn from Seoul's economic development experience.
"Though the relations between the two countries have existed for 50 years, the potentials for cooperation have not been fully exercised. Therefore, I want to say that the prospects of relations between the two
countries are very promising and there are a lot of expectations," Correa said.
Since 2008, a series of high-level exchanges between the two countries have led to South Korean companies winning a number of contracts in oil refinery, wind power plants and gas pipeline construction projects.
Standing out the most among the firms is SK Engineering & Construction Co.
In late 2008, the company won a US$85 million contract for the first-stage construction in the project to renovate an oil refinery in the
coastal city of Esmeraldas, and then won the $290 million contract for its second-stage construction last year.
This year, the company won the basic engineering contract for the Manabi project.Potentials for cooperation between the two
countries in oil and other natural resources development are also huge, officials said. Recoverable reserves of crude in Ecuador are estimated at 5.1 billion barrels, but experts said the actual reserves would be twice as large.
Correa praised South Korean companies for their transparency and expertise, and said that not only SK, but also other Korean companies are
expected to participate in refinery and hydraulic power plant construction and other projects.
"But what is more important than anything else is technology transfer," the Ecuadorian leader said. "When Korean companies do business with Ecuador, I think that technology transfer must be mentioned in the contracts. This will help us nurture talents that will in turn contribute to national development."
Correa also said that Ecuador is considering a number of measures to attract foreign investment, such as tax cuts and other incentives, infrastructure construction and setting up of special economic zones. For South Korean firms, Ecuador can serve as a "gateway" to Central and South American nations, he said.
President Correa, who first took office in early 2007 and was re-elected last year, has been pushing forward with industrial reform policies, trying to expand the state's role in such strategic industries as energy, resources and electricity while seeking to strengthen ties with Asia-Pacific nations to develop new markets and attract foreign investment.
A development economics scholar, Correa has also shown great interest in South Korea's economic development path. Seoul's ambassador to Ecuador Jang Keun-ho recently recalled Correa as saying he "admires" South Korea's economic development, when the envoy presented his credentials to the president in 2008.