Saudi prince’s Seoul trip brings $30 billion in business deals

Mohammed bin Salman, the crown prince and prime minister of Saudi Arabia, flew into Seoul on Thursday and clinched $30 billion in bilateral deals with South Korea, which aims to tighten its relations with the Middle Eastern country.

The visiting Saudi leader, dubbed “Mr. Everything” for his astronomical wealth and many business portfolios, held high-profile meetings with Korean President Yoon Suk-yeol and the country's top business leaders, producing 26 memorandums of understanding at their investment forums.

The two nations' leaders reviewed ways to deepen their political relations as well as economic partnerships in various areas, including infrastructure, chemicals, renewable energy, gaming and advanced technologies, according to their governments.

Business leaders of the two countries have also discussed prospects for future cooperation in the nuclear power plant construction and defense businesses, which, if realized, could result in deals worth as much as 100 trillion won ($74 billion), including the $30 billion initial agreements made on Thursday, industry watchers said.

The de facto Saudi Arabian ruler’s official Seoul visit comes on the heels of his trip to the G20 summit in Bali, Indonesia.

COVID-19 TESTS BEFORE MEETING WITH PRINCE

Late on Thursday, the Saudi crown prince met with leaders of Korea’s eight major business conglomerates – Samsung’s Jay Y. Lee, SK’s Chey Tae-won, Hyundai Motor’s Chung Euisun, Hanwha’s Kim Dong-kwan, CJ’s Lee Jay-hyun, Doosan’s Park Jung-won, DL’s Lee Hae-wook and Hyundai Heavy’s Chung Ki-sun.

The business leaders were tested for COVID-19 before meeting with the Saudi prince, officials said.

Company officials said the MOUs focused on potential business deals for Korean firms to join the estimated $500 billion Neom megacity project in the oil-rich kingdom.

The Saudi prince is pushing to build Neom, a smart city to be fully run on renewable energy and cutting-edge technologies in a desert area in the kingdom's northern Tabuk Province.

The smart city is to operate on electricity from solar power and green hydrogen while employing 5G networks, the internet of things (IoT), cloud computing and robotics.

Samsung Group leader Lee discussed with the prince applying the company’s advanced technologies, including 5G wireless communications, IoT and artificial intelligence, to Neom's city management systems, Samsung officials said.

Samsung C&T Corp., Hyundai Engineering & Construction Co. and several other Korean companies are currently involved in the megacity development project.

Samsung C&T is participating in a $10 billion project involving the construction of 10,000 houses in Neom using a steel modular method.

Korea Electric Power Corp. (KEPCO), its affiliate Korea Southern Power Co., Korea National Oil Corp. and POSCO Holdings Inc. have agreed to build a $6.5 billion green hydrogen and ammonia production plant in Saudi Arabia.

SK Group Chairman Chey held talks with the Saudi prince on jointly promoting eco-friendly energy projects. SK Geo Centric Co., the petrochemical unit of SK Group, has already agreed with a Saudi Arabian Oil Co. affiliate to launch a clean energy joint venture.

HYUNDAI MOTOR EYES UAM, ECO-FRIENDLY VEHICLE PROJECTS

During his meeting with the Saudi prince, Hyundai Motor Co. Chairman Chung explained the automotive group’s urban air mobility and eco-friendly vehicle development projects.

Hyundai and Saudi Arabian Oil, also known as Saudi Aramco, are working on developing an eco-friendly synthetic fuel and using it on hybrid vehicles.

On Thursday, Hyundai Rotem Co., the railway system manufacturing unit of Hyundai Motor Group, clinched a $2 billion deal to sell high-speed trains to the Saudi government.

Kim Dong-gwan, vice chairman of Hanwha Group, which signed a large-scale defense deal with Saudi’s defense ministry in March, explored the possibility of further weapons exports to the Middle Eastern country, officials said.

Hyundai Heavy chief Chung Ki-sun shared his views on the progress of the establishment of a joint shipyard and an engine joint venture.

CJ’s Lee Jay-hyun discussed with the Saudi crown prince cultural and content exchanges between the two countries, while Doosan’s Park expressed his intention to participate in Saudi Arabia’s nuclear power plant construction projects, according to company officials.

Earlier this week, S-Oil Corp. the Korean unit of Saudi Aramco, said it will approve the much-touted 8 trillion won Shaheen project to expand its petrochemical business.

The megaproject titled Shaheen, meaning hawk in Arabic, is Saudi Aramco’s largest investment in Korea’s oil industry.

Write to Sang-eun Lucia Lee, Jeong-Soo Hwang and Il-Gue Kim at selee@hankyung.com
In-Soo Nam edited this article.