(From left) Kim Jeong-il, CEO of Kolon Global; Khaled Al Abudi, CEO of FAIDH; and Michael Ahn, CEO of Olefarm, are taking a commemorative photo after signing a business agreement to promote smart farm projects and maximize production at the Korea Chamber of Commerce and Industry on the morning of the 17th. Photo by Kolon Global
[Asia Economy Reporter Hwang Seoyul] Domestic strawberries are being cultivated in the deserts of Saudi Arabia. This marks the fruition of a new business strategically pursued by Kolon Global to secure future growth engines. Alongside this, Kolon Global is also promoting participation in the water treatment sector and wind power projects within Saudi Arabia's massive smart city construction project, the NEOM City Project, valued at approximately 668 trillion KRW.
On the 17th, Kolon Global announced that it signed a Memorandum of Understanding (MOU) at the Korea Chamber of Commerce and Industry with FAIDH International Food (FAIDH), a Saudi Arabian food manufacturing, import-export, and distribution company, and Olefarm, a domestic smart farm company in which Kolon Global has invested equity. Previously, in June 2020, Kolon Global invested 5 billion KRW in the smart farm startup Olefarm, acquiring a 20% stake. Olefarm possesses a cultivation system capable of growing fruit crops such as strawberries even within containers.
Under this agreement, Kolon Global plans to leverage its accumulated overseas sales expertise to collaborate with local partner FAIDH on market analysis and feasibility studies to advance the smart farm business. Olefarm will provide modular smart farm technology and the technology to cultivate, produce, and distribute domestic strawberry seeds in Saudi Arabia.
FAIDH will comprehensively cooperate in local financing, site acquisition, and obtaining operational permits. FAIDH’s CEO, Khaled Al Aboudi, is a prominent figure who previously served as the head of the Islamic Development Bank and currently serves as a board member of the Agricultural Policy Development Bank.
Saudi Arabia has faced complex challenges such as desert climate, lack of agricultural land, and water shortages, making the cultivation and supply of fresh strawberries difficult. Additionally, overcoming the high temperature and humidity during summer is not easy, making it one of the countries where smart farm projects are challenging. To develop and foster agricultural infrastructure, which is mostly dependent on imports, Saudi Arabia established a fund worth 500 million USD in 2020, which is expected to strengthen this tripartite agreement.
Kolon plans to supply domestically produced fruit crops throughout Saudi Arabia, including NEOM City, through this project. Furthermore, it intends to participate in the water treatment and wind power projects of the NEOM City Project. A Kolon Global official stated, "We are promoting participation in the NEOM City Project in the water treatment sector and wind power business, areas where we have competitive advantages."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
