Korean-Saudi Investment Forum culminates in 26 investment agreements

H.E Khalid Al-Falih, Minister of Investment of Saudi Arabia attended the Saudi-Korean Investment Forum along with H.E Dr. Lee Chang-yang, Korea’s Minister for Trade, Industry and Energy.

During the Saudi Korean Investment Forum, 26 investment agreements worth about SAR112.7 billion (USD $30 billion) were signed covering sectors such as energy, industrial and manufacturing, transport, financial services, ICT, chemicals, environment services, food processing and pharmaceuticals sectors.

Seoul, Republic of Korea: As a part of the official visit by HRH Mohammed Bin Salman Al-Saud, Crown Prince and Prime Minister of the Kingdom of Saudi Arabia to the Republic of Korea, a Saudi Korean Investment Forum was hosted in Seoul, today, by the Saudi Ministry of Investment. The Forum, which was supported and attended by leading members of the Saudi Federation of Chambers and the Korean Chambers of Commerce and Industry, was attended by H.E Khalid Al-Falih, the Saudi Minister of Investment, H.E Faisal AL Ibrahim, Saudi Minister of Economy & Planning, H.E Dr. Lee Chang-yang, Korea’s Minister of Trade, Industry and Energy, as well as related government entities and leading private sector companies from both countries.

In addition to its busy schedule of presentations and discussions, the Forum also witnessed the signing of 26 investment agreements and Memoranda of Understanding with a combined value of about SAR112.7 billion (USD $30 billion).

Commenting on the official visit by HRH Crown Prince Mohammed Bin Salman Al-Saud to South Korea and on the Saudi Korean relations, H.E Khalid Al-Falih said:

“The trade links between Korea and Saudi Arabia are strong and run deep, dating back to the 7th century. Today, as this historic visit takes place, the Kingdom is leading the world as the fastest growing major economy, while Korea under the leadership of H.E President Yoon represents the world’s 10th largest economy. Driven by the private sector, Korea’s successful economy and the global positioning of so many Korean companies, which are household names, are testament to Korea’s strategy’s success.

The Korean model has been a benchmark for Saudi Arabia’s Vision 2030 and National Investment Strategy, which aim to increase the private sector’s contribution to the economy to 65% of GDP by the end of this decade.

“As proud as we are of the historic links, we are now shifting our focus to the next six decades of our partnership and beyond. The goal of the Kingdom is to grow and diversify the economy away from oil, and we’re swiftly transitioning from a solely hydrocarbon-based economy to one spearheading fuels and technologies of the future.

Vision 2030 marks the transformation of the Kingdom of Saudi Arabia into a diversified, modern economy led by multiple new sectors built through innovation, technology, and partnerships around the world, including with the Republic of Korea.”

The main presentation and discussion topics of the Saudi-Korean Investment Forum included Energy and sustainability, with a panel session on ‘Future Clean Energy’. Furthermore, the Forum also discussed Saudi Arabia’s economic diversification, localization, and privatization efforts as well as manufacturing.

To expand the horizon further, the Forum held discussion panels on ‘Global Projection of Supply Chain and Fostering Innovation’ and ‘Growth for Future Generations’, which set the tone for discussions on innovation, technology, and entrepreneurship.

The Forum also witnessed the signing of a wide variety of Government-to-Business and Business-to-Business agreements and Memoranda of Understanding to booster mutual investments and further study and develop the potential of investment opportunities in established or newly developing sectors in the Saudi Arabia.

The signed documents covered sectors such as chemicals and petrochemicals, green hydrogen production, auto sector, shipbuilding, pharmaceuticals and biopharma, transportation, metal casting and forging, information technology and artificial intelligence, electronic games and promotional video and music production, as well as venture investment.

Among the most important agreements that were signed during the Forum was an engineering, procurement and construction awarding contract for S-OIL’s second phase petrochemical expansion project, Shaheen Project. It is Korea’s largest refining/petrochemical plant construction contract worth SAR25.5 billion (USD $6.8bn).

The Shaheen Project includes the world’s largest steam cracker (ethylene 1,800KTA).

Armed with cutting-edge technologies, it converts crude oil into petrochemical feedstock and polymer to further produce petrochemicals as feedstock for plastics and other synthetic materials. Construction of this project will start in 2023 and target completion is 2026.

The Saudi Public Investment Fund (PIF) has also signed two non-binding Memoranda of Understanding with Korean companies. The first MoU aims to develop a green hydrogen production project in the Kingdom for export purposes, building on an agreement signed in January 2022 between PIF, Samsung C&T and POSCO, by adding new partners KEPCO, KNOC and KOSPO as potential investors and offtakers. The second MoU is with Samsung C&T to explore the opportunities through cooperation to increase and accelerate the adoption of modular construction technology in Saudi Arabia.

Other Korean entities that signed agreements with Saudi entities during the Forum included Hyundai Rotem, Doosan, BIFIDO, Y Data & Service, the Korea Venture Investment Corporation, and Shift Up to name just a few.

The Investment agreements signed during the Forum further highlight the momentum that Saudi Arabia has established as it becomes increasingly competitive on the global stage, reflecting the strong growth Saudi Arabia has seen in foreign direct investment (FDI) in recent years as the Kingdom’s economic reforms have unlocked a broad range of opportunities for international investors.

Last year net FDI growth increased by an unprecedented 257.2%, with inflows totalling almost SAR75 billion (USD $20bn) for the year – the highest they have been in 10 years. This momentum continued into 2022, with underlying inflows, excluding a major one-off transaction in 2021, growing 26% on a year-on-year basis in the first half.

According to the International Monetary Fund, Saudi Arabia is expected to be the fastest-growing G20 economy this year, due in part to sweeping pro-business reforms, with gross domestic product expected to expand by around 8 percent, the fastest growth in almost a decade.

The Republic of Korea is a strategic partner to Saudi Arabia and, as a country with services and products known worldwide for durability and reliability, these agreements will enable the same level of world-leading technology in Saudi Arabia.

Investment from world-leading companies such as Hyundai Rotem, Samsung C&T and KEPCO among others, is anticipated to enable growth in both economies.

Since the creation of the Saudi-Korea Vision 2030 Committee in 2017, both countries have been supporting business ventures in five key sector groups: energy and manufacturing, smart infrastructure and digitization, capacity building, health care and life sciences, and SMEs and investments.

Bilateral trade between Saudi Arabia and the Republic of Korea increased 66 percent during the third quarter of 2021, compared to the same period 12 months prior, jumping to SR27.7 billion (USD $7 billion).

About the Ministry of Investment

The ongoing transformation of Saudi Arabia under the Vision 2030 economic development and diversification plan is unlocking new investment opportunities at an unprecedented pace. The Ministry of Investment of Saudi Arabia (MISA) is facilitating access to these opportunities by developing a vibrant cross-government investment ecosystem, facilitated by Saudi Arabia’s National Investment Strategy.

Through a network of representative offices across the world, MISA partners with businesses of all scales and sizes from startups to blue-chip multinationals—to help make investing in Saudi Arabia as simple as possible. MISA also plays a leading role in improving Saudi Arabia’s overall business environment by facilitating investment data across regions and sectors, creating investment incentives, spearheading business reforms and opening up investment opportunities.

About the National Investment Strategy

Launched in October 2021, the National Investment Strategy (NIS) is an ambitious plan to accelerate investment in Saudi Arabia – helping to expand and diversify the economy and underpin the ambition set out in Vision 2030.

The NIS aims to unlock investment across the Saudi economy and help the growth of emerging sectors and ecosystems by creating a competitive investment environment that provides stability and clarity for investors.

In the past year, as part of the NIS, MISA launched both the Global Supply Chain Resilience Initiative (GSCRI) and the Saudi Investment Promotion Authority (SIPA), which will fundamentally transform the Kingdom’s investment environment. The GSCRI will enable global investors to create low-risk, low-cost and low-carbon supply chains, aiming to attract more than US$10bn of industrial and service investments in its first phase. SIPA will facilitate an integrated approach to investment between government agencies while enhancing investors’ experience.

About Invest Saudi

Overseen by Saudi Arabia’s Ministry of Investment (MISA), Invest Saudi is the Kingdom’s investment attraction and promotion entity charged with communicating and facilitating investment opportunities.

Invest Saudi is the primary point of contact for foreign investors seeking information and assistance before, during and after their entry into Saudi Arabia. It is committed to working in partnership with potential and current investors to make their investment journey a seamless experience.