China’s rise set to change tech sector

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China’s rise set to change tech sector

“When two Chinese companies are rated first and second, can we trust them?”

“Is the low bidding price a critical factor?”

In the press room at the Ministry of Oceans and Fisheries on Wednesday, reporters had many questions about Shanghai Salvage, which was chosen as the preferred bidder to salvage the capsized Sewol ferry. The media presentation went over schedule by more than an hour, and the public seemed similarly skeptical. Attorney Park Ju-min, who represents the families of the victims of the Sewol ferry, also expressed concerns over whether Chinese companies really had more advanced technologies than other consortiums. But in the assessment, technology scores made up 90 points, and the salvage price was 10 points. Without technological capacity, no company can become a preferred bidder with competitive prices alone.

According to Jeong Yong-hyeon, an adviser at the Korea Institute of Ocean Science and Technology, China’s maritime technology is world-class, and China has been developing underwater exploration technology for over a decade to develop maritime resources. In 2007, China developed a deep-sea submarine that could explore depths down to 7,000 meters (4.3 miles). In 2012, Shanghai Salvage showcased the Shen Quan Hao, a diving support vessel that can operate 300 meters underwater. The vessel is equipped with a saturated diving device that provides divers with helium instead of nitrogen during underwater operations. China is a technology power from the deep sea to space, having succeeded in manning a spaceship launch in 2013.

In fact, Shanghai Salvage was ranked high in the technology assessment as well. It analyzed the Sewol ferry, which had been underwater for more than a month, and proposed an idea to lift the ship from the bottom, as lifting it from the top may result in damage. The Chinese company also addressed the geographical advantage of being close to the site of sinking. By reducing manpower and logistics costs, it bid 15 billion won ($13 million) below the estimate of 100 billion won.

Of course, a formal contract is yet to be signed, and we have a long way to go until the ship is actually salvaged. However, we cannot take Chinese companies’ dominance in the bidding lightly. Lee Jeong-dong, a professor in Seoul National University’s Technology, Management, Economics and Policy Program, acknowledged that China boasts a solid foundation in aerospace and marine science and technologies, and when basic technologies meet sophisticated technologies, it will display formidable potential.

In the manufacturing industry, China wants to catch up with Germany and Japan, and in the near future, the Made in China label will no longer be synonymous with cheap products. Korea, then, is destined to compete against another tech power.

The author is a business news reporter at the JoongAng Ilbo.

JoongAng Ilbo, July 17, Page 29


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