Korea, Saudi Arabia to bolster industrial ties
By Yoon Ja-young
Korea and Saudi Arabia will strengthen cooperation in diverse industrial sectors such as shipbuilding and automobiles, by holding a biannual industrial cooperation committee meeting.
According to the Ministry of Trade, Industry and Energy (MOTIE), Minister Joo Hyung-hwan met Khalid Al-Falih, Saudi Arabia’s Minister of Energy, Industry and Mineral Resources, in Seoul, Friday, where they agreed to hold the biannual industrial cooperation meetings.
“The two countries agreed that cooperation should be expanded to automobile, shipbuilding, electronics and infrastructure from investment and oil trade,” an official at the ministry said.
Saudi Arabia is a country of strategic importance to Korea. It imports 30 percent of its crude oil from Saudi Arabia, which is also Korea’s sixth-biggest trading partner globally and its top trading partner in the Middle East.
The two countries have been strengthening cooperation, including a visit by President Park Geun-hye to the country in March 2015 and another by Prime Minister Hwang-Kyo-ahn in May this year.
At the meeting, Joo cited the oil refinery upgrading project of Aramco’s S-Oil, cooperation between Hyundai Heavy Industries and Aramco as well as investment in POSCO E&C by Saudi Arabia’s Public Investment Fund as fruits of cooperation between the two countries. Saudi Arabia’s state-run oil firm Aramco is investing 5 trillion won to upgrade facilities of local oil refiner S-Oil in which it is the biggest shareholder with a 63.46 percent stake. Al-Falih served as president and CEO of Aramco between 2009 and 2015.
Hyundai Heavy Industries and Aramco signed an MOU last November, on the joint development of a shipyard and ship engine factory in the Middle Eastern country.
Based on the trust built in oil and plants, the two countries plan to expand cooperation to other sectors such as shipbuilding, petrochemicals and new energy.
Saudi Arabia is seeking cooperation with Korea for its Vision 2030, a long-term blueprint aiming at industrial diversification from an oil-dependent economy. The Saudi Arabian minister said the country plans to expand investment in new renewable energy and infrastructure, diversifying the scope of cooperation to the automobile, shipbuilding, chemical, electronics and IT industries. He added that the country is considering Korea as a strategic partner for this.
At the industrial cooperation committee meeting, the two countries are likely to discuss concrete measures for expanding economic ties, including joint investment in automobiles or jointly investing in another country. Saudi Arabia, which will be setting up huge funds through privatization of state-run enterprises, is considering diverse investment options.