SG: "Increasing Loss of Ukraine's Road and Transport Infrastructure... Restoration Costs to Exceed 114 Trillion Won"

SG announced on November 27 that the increasing damage to Ukraine's major transportation networks is leading to higher estimated restoration costs. Nazarenco Andrii, head of SG's local subsidiary in Ukraine, stated, "The prolonged war is causing greater destruction of roads," and added, "The cost of restoring road, transportation, and logistics infrastructure is expected to exceed 114 trillion won this year."

This figure is based on the '4th Rapid Damage and Needs Assessment (RDNA4)' jointly released by the United Nations, World Bank, European Commission, and the Ukrainian government. RDNA4 estimates Ukraine's reconstruction costs over the next 10 years at $524 billion (approximately 772 trillion won), which is about a 27.5% increase from the $411 billion (about 606 trillion won) reported in RDNA2 in 2023. By sector, it was calculated that $77.5 billion (about 114 trillion won) would be required solely for transportation infrastructure restoration.

After the end of the war with Russia, transportation and logistics infrastructure such as roads is expected to be the top priority for restoration. In preparation for increased reconstruction demand, SG has been establishing a local business foundation. After setting up its Ukrainian subsidiary, the company has been investigating the structure of orders for lost sections and technical requirements through consultations with government agencies and private partners. The company analyzed that, as the rate of loss of road and transportation infrastructure increases, there is a high likelihood of large-scale orders over the medium to long term.

Ukraine, with its developed steel industry, is considered highly suitable for the application of eco-friendly asphalt concrete using steel slag (product name 'EcoSteelAscon'). SG has already signed a supply contract worth about 17.8 billion won with a local company and secured related patents. This year, a pilot paving of an 850-meter section near Kyiv received favorable evaluations for quality and structural safety from a local assessment agency. The company considers this data as supporting evidence that can be used in future technical and construction bids.

SG highlighted the following as competitive advantages: ▲pavement technology based on steelmaking by-products and local patent registration ▲the local subsidiary's ability to respond to orders and evaluations ▲existing contracts and pilot paving data. The company explained that these factors could serve as a foundation for securing priority in future negotiations with ordering parties.

SG plans to move forward with finalizing construction models, securing additional supply contracts, and strengthening production and logistics capabilities. The company stated, "Based on our patent registrations and pilot paving results, we are continuing discussions with local ordering parties, and if projects are confirmed, phased revenue recognition will be possible."

This content was produced with the assistance of AI translation services.