Bin Salman Unleashes Tens of Trillions Won... 26 Investments and MOUs Signed (Update)

Saudi Crown Prince Visits Korea... 'Neom City' Boom

Saudi Crown Prince Bin Salman Visits Korea After 3 Years and 5 Months... Prime Minister Han Duck-soo Welcomes Him at the Airport
(Seoul=Yonhap News) Saudi Arabia's de facto ruler, Crown Prince Mohammed bin Salman, arrived at Seoul Airport around 12:30 a.m. on the 17th. Prime Minister Han Duck-soo welcomed him and they moved together.
This is Crown Prince Bin Salman's first visit to Korea in 3 years and 5 months since June 2019. 2022.11.17 [Provided by the Prime Minister's Office. Resale and DB reproduction prohibited]
kimsdoo@yna.co.kr
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[Asia Economy Sejong=Reporter Lee Jun-hyung] In line with the visit of Saudi Arabia's de facto ruler Crown Prince Mohammed bin Salman, South Korea and Saudi Arabia signed 26 investment and business memorandums of understanding (MOUs). The scale of projects agreed upon by the two countries amounts to tens of trillions of won. If the cooperation proceeds as planned, there is growing anticipation that South Korea could experience a 'second Middle East boom' following the 1970s.

According to the Ministry of Trade, Industry and Energy on the 17th, South Korea and Saudi Arabia held an investment forum at the Korea Chamber of Commerce and Industry International Conference Hall that morning and consecutively signed MOUs. The forum was attended by Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy and Saudi Minister of Investment Khalid Al-Falih, who witnessed the MOU signing ceremony. The investment contracts and MOUs signed between Korean companies and Saudi government agencies and companies totaled 26. Each MOU reportedly involves project costs in the trillions of won.

One notable cooperation project is between Hyundai Rotem, the railway vehicle subsidiary of Hyundai Motor Group, and Saudi Arabia. Hyundai Rotem signed an MOU with the Saudi Ministry of Investment related to the 'NEOM City' railway cooperation. The core of the agreement is to collaborate on building railway infrastructure for NEOM City, a $500 billion (approximately 664 trillion won) new city project being promoted by Saudi Arabia.

The agreement also includes joint development of hydrogen-powered locomotives with Saudi Arabia. If Hyundai Rotem wins the contract for Saudi high-speed rail in the future, it will mark the first export success of domestically produced high-speed trains. The Saudi high-speed rail project is valued at 2.5 trillion won.

Hydrogen Cooperation Also Pursued... Worth '8.6 Trillion Won'

Cooperation in next-generation energy sectors is also being pursued. Five companies, including Korea Electric Power Corporation (KEPCO) and Samsung C&T, signed an MOU with the Saudi Public Investment Fund (PIF) to collaborate on green hydrogen development. The project involves building a green hydrogen and ammonia production complex on a 400,000 square meter site along the Saudi Red Sea coast, with a project scale of $6.5 billion (approximately 8.6 trillion won). It is reported that the production complex will be constructed to achieve an annual output of 1.2 million tons from 2025 to 2029.

In the construction sector, Samsung C&T signed an MOU with PIF for modular housing business cooperation. Samsung C&T will build modular homes worth $4 billion (approximately 5.3 trillion won) in NEOM City. Daewoo Engineering & Construction signed an MOU with Saudi construction company Alfanar to broadly cooperate in oil, gas, and petrochemical businesses. Kolon Global agreed to cooperate with local companies to establish a smart farm joint venture.

S-Oil Bets '8 Trillion Won'

Along with Crown Prince bin Salman's visit, large-scale investments from the Saudi side were made. S-Oil, a subsidiary of Saudi state-owned company Aramco, finalized plans to promote the mega petrochemical project 'Shaheen' (meaning 'falcon' in Arabic) by investing about 8 trillion won in Ulsan, and signed EPC (engineering, procurement, and construction) contracts with three domestic construction companies including Hyundai Engineering & Construction and Lotte Engineering & Construction.

The Shaheen project involves building chemical product facilities with an annual production capacity of 1.8 million tons around the Ulsan S-Oil plant. The construction period is from next year until 2026. Previously, S-Oil announced the Shaheen project plan during Crown Prince bin Salman's visit in 2019.

The government views the forum as having strengthened the economic cooperation foundation between South Korea and Saudi Arabia. Minister Lee said, "The Shaheen project is a representative successful case that leads the low-carbon and high value-added transformation of the oil industry by utilizing the complementary energy industry structures of South Korea and Saudi Arabia," adding, "The government will actively support the successful promotion of bilateral cooperation projects."