President Moon Jae-in ordered a relief team to be sent to southeastern Laos, Wednesday, where hundreds of people are feared to be missing or dead following the collapse of a dam being built by a consortium led by Korean construction firm SK Engineering and Construction (SK E&C). The failure of the hydroelectric dam Monday evening following heavy rains has caused extensive damage, swamping several villages and forcing thousands to flee their homes.
It is rare for the President to order emergency rescue measures for an accident in a foreign country. The President said it was important for the government to provide swift support since a Korean firm was involved. The dam was one of the auxiliary dams of the $1 billion hydroelectric power project in Attapeu Province launched in 2013 by the consortium of SK E&C, Korean Western Power, Thailand's Ratchaburi Electricity Generating Holding and the Lao Holding State Enterprise. SK E&C has the biggest stake in the project with 26 percent.
The President's decision to aid the rescue operation was timely as the disaster could adversely affect Korea's image and more importantly, the credibility of South Korean firms and builders. Southeast Asia is becoming an increasingly important market for Korea, with President Moon's New Southern Policy expediting economic cooperation with the Association of Southeast Asian Nations (ASEAN). All of Southeast Asia will keenly watch how the government and Korean firms respond to the accident. The government has the responsibility to manage the crisis properly so this does not evolve into a diplomatic issue.
SK E&C and the government should not only do their best to extend humanitarian efforts, but also to find out the cause. The company should examine whether there were any construction failures that could have contributed to the disaster. No matter what the cause, SK E&C cannot avoid responsibility as severe damage has occurred from a project it was leading.
The most urgent task at this point is to properly manage the aftermath and minimize the damage. SK E&C and the government should extend all-out efforts to support the rescue operations and aid the victims.
Also, it would be wise to examine overseas construction sites of other Korean builders for any mismanagement and to ensure safety.