Korea-Saudi Sign Contract to Establish Joint Venture Car Factory with Annual Production of 50,000 Units... Creating Momentum for Economic Cooperation

'Korea-Saudi Investment Forum' Held in Riyadh, Saudi Arabia After 11 Months
46 Contracts and MOUs Signed Including Korea's First Middle East Automobile Factory Establishment Agreement

South Korea's first automobile factory in the Middle East is set to be established in Saudi Arabia.

The Ministry of Trade, Industry and Energy announced that during the '2023 Korea-Saudi Investment Forum' held in Saudi Arabia on the 22nd (local time), jointly hosted by the Korea Economic Association and the Saudi Ministry of Investment, a total of 46 MOUs (40) and contracts (6) were signed in the presence of Minister of Trade, Industry and Energy Visit Kyoo and Saudi Minister of Investment Khalid Al-Faleh.

In the energy sector, Korea Electric Power Corporation, POSCO Holdings, and Lotte Chemical signed a Letter of Intent (LOI) for cooperation on blue ammonia production worth a total project cost of $15.5 billion with Saudi Aramco, resulting in three cooperation achievements in the hydrogen field. Additionally, seven contracts and MOUs were signed, including joint crude oil stockpiling and joint bidding participation.

Furthermore, a total of eight achievements were made in the real estate and infrastructure investment cooperation between Hyundai Engineering & Construction and the Saudi Ministry of Investment, seawater desalination projects to supply water in desert areas, smart city cooperation projects such as NEOM, and energy and plant sectors.

Moreover, Hyundai Motor Group and the Saudi Public Investment Fund (PIF) signed a contract to establish a joint venture factory producing 50,000 internal combustion engine and electric vehicles annually. This will establish South Korea's first automobile factory in the Middle East. Additionally, an MOU for establishing an automotive parts supply chain by the KG Mobility consortium and an MOU for establishing a local electric vehicle parts factory by CTR were signed, which the Ministry of Trade, Industry and Energy expects will contribute to building a supply chain across the entire automotive industry following previous supply chain development in the shipbuilding sector.

In the advanced industry and manufacturing sectors, follow-up achievements from the '2022 Korea-Saudi Investment Forum' held last November were also realized. BMT signed a joint venture establishment contract with a Saudi company for localization of fittings and valve manufacturing as a follow-up to the previous MOU. In addition, a total of 19 cooperation achievements were made in fields such as electric vehicle charging and factory technology transfer in manufacturing.

For food security in Saudi Arabia, Korean companies including Nongshim signed a business agreement with Saudi Greenhouse for the establishment of smart farms. In new industries, a total of 10 contracts and agreements were signed, covering bio sectors such as medical devices and rare disease diagnostics, as well as robotics including kitchen automation robots and drones, and even sports business.

In the financial sector, the Korea Trade Insurance Corporation signed a cooperation memorandum worth $3 billion with Saudi Aramco and Korean companies to support winning Aramco-ordered projects.

The government plans to actively support the smooth progress of a total of 128 cooperation projects, including 26 cooperation projects worth $29 billion signed at the investment forum last November and 56 tasks (including 17 new ones) discovered at the '4th Korea-Saudi Vision 2030 Committee' chaired by Minister Visit Kyoo and Saudi Minister of Investment Al-Faleh last October, through the 'Korea-Middle East Economic Cooperation Public-Private Promotion Committee' chaired by the Minister of Trade, Industry and Energy.

Visiting Minister of Trade, Industry and Energy Bang Moon-kyu (eighth from the left) attended the "Korea-Saudi Investment Forum Contract and MOU Signing Ceremony" held on the 22nd (local time) at the Fairmont Riyadh Hotel in Riyadh, Saudi Arabia, with the delegations from both countries, including Khalid Al-Falih, Minister of Investment of Saudi Arabia. He participated in the MOU signing ceremony that achieved 46 contracts and MOUs, including the establishment contract of Korea's first automobile factory in the Middle East, totaling USD 8.29 billion, and took a commemorative photo.

This content was produced with the assistance of AI translation services.