Korea nuclear exports: Why did the Koreans win the UAE tender? Will Korea achieve its goal of exporting 80 nuclear reactors by 2030?
Résumé
The success of Korea in winning, in December 2009, a USD 18.6 billion nuclear tender in the United Arab Emirates (UAE) has led to a growing interest in the organization and strengths of the Korean nuclear industry. In this paper, we present the main economic and political factors that explain the success of the Korean consortium. In particular, thanks to an active national program of Nuclear Power Plant (NPP) construction, Korea has developed distinct competitive advantages in terms of low cost, high credibility and high performance. At the same time, due to the important barriers to enter into the nuclear export market in the UAE, Korea has had to sacrifice its profit margin and has benefited from a strong political support from its government through export financing. More importantly, Korea's success is also due to its alliance with Westinghouse and the support of the US diplomacy. Subsequently, we show that while Korea has recently experienced setbacks in nuclear tenders, it will most certainly try to win in the short run a second nuclear tender with another aggressive price. In the longer run, Korea could take a growing share of the international market for NPPs. However, the extent to which Korea can achieve its long term export target will depend upon its capacity to finance nuclear export through export credits and upon the development of its alliance with Westinghouse.
Domaines
Economies et finances
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