South Korean economic woesset to hit UK architects
British architects are bracing themselves for the fallout from the Korean stock market crash, with some expecting half their fees to be wiped out.
Brian Chantler, a director of Terry Farrell and Partners, said the country's currency value had slumped by 50 per cent in a month. Money paid to some architects would be half the value it was before the collapse.
Chantler would not be drawn on details of Terry Farrell's one major contract in Korea, an airport in Inchon. However, he warned that the knock-on effects for the profession might ripple far beyond Korea and hit projects in Thailand and the Philippines. 'Private developers in some Far Eastern countries have gone very quiet and put on hold all projects until further notice. We are waiting to see if the International Monetary Fund tells Korea to cut its budget.'
Neven Sidor, a director at Nicholas Grimshaw and Partners, said most commercial practices should be able to absorb a few cancelled projects, but firms heavily relying on Far East projects could be hit. His own practice had won a government competition 18 months ago for a high-speed rail link station but was still waiting for the go-ahead. It could hinge on the imf, which may insist on cutbacks in public spending, he said.
Ian Birtles, financial controller at the Richard Rogers Partnership, said the contract for the firm's design for a broadcasting centre in Seoul had been negotiated in sterling, and so the practice would not lose out.
Foster and Partners, with offices in Hong Kong and Singapore, said it had not felt the affects of the meltdown - yet. 'But in the fullness of time, activity might slow down,' said finance director Barry Cooke. However, he believed the last thing international financiers wanted was a Korean economy collapse. 'There is still so much sound money slushing around the system.'
The international community has agreed to provide £60 billion to support South Korea's stricken economy, but experts fear the debt owed by the country's banks could far outstrip that sum.