No. 1 shipper has windfall as rebuilding surges in IraqCJ Korea Express seems to be enjoying the rising demand from projects in Iraq as its international shipping volume increased dramatically this year.
According to the company, package deliveries between Korea and Iraq from January through May totaled 23 tons, 10 times more than a year ago.
The company said its main customers are Korean companies in Iraq operating businesses related to rebuilding projects. The Iraqi government has announced it will execute $275 billion worth of infrastructure reconstruction projects in energy, medical, IT and other sectors.
Korean companies like Hanwha Engineering & Construction have already seen benefits. The builder last May signed a $7.75 billion contract with the Iraq’s National Investment Commission to build a new city.
Shipping arm of CJ Group said shipping demand from Iraq is likely to grow further as more companies land there in part because of Korean government support. The Ministry of Trade, Industry and Energy and Korea Trade-Investment Promotion Agency held a business forum in April to connect companies with Iraqi businesses and government officials.
CJ Korea Express claims it has a competitive edge in Iraq after signing a partnership with Aramex, the largest logistics firm in the Middle East, last year. According to the company, delivery time from Korea to Iraq is four or five days, nearly half that of competitors, while the charges are 10 percent cheaper than those of other local shippers.
“After the alliance with Aramex, we have a delivery network that covers the entire Middle East region, and we are supporting exporting companies by signing a cooperative shipping agreement with Korea International Trade Association and the Korea Chamber of Commerce and Industry,” said Son Gwan-su, the co-CEO of the company. “We will be strong partners for those who are conducting business in Iraq.”
The company is the affiliate of CJ Group, which is being investigated by prosecutors for allegedly creating secret funds and evading taxes. It became the nation’s largest logistic firm after merging with its unlisted affiliate CJ GLS in April.
By Joo Kyung-don [email@example.com]