The United Arab Emirates’ (UAE’s) national wealth fund has promised to make its largest-ever investment in South Korea.
The head of government planning, Lee Kwan-seop, stated the following during a briefing in Abu Dhabi: “When compared to other similar cooperative investments, the amount invested this time is overwhelmingly large, the statement continued, and it is roughly $12.2 billion ($10 billion) more than was invested in the United Kingdom. We have promised China $5 billion and France €1.5 billion.”
Although the exact investment time is not stated, it is anticipated that the investment will be concentrated until the following year. “”There is confidence in the development potential, excellence of Korean companies, and the broader Korean economy,” Lee said, adding that Abu Dhabi Chief Executive Khaldoon believes there will be significant investment prospects in Korea next year. That is how we arrived at the figure ($30 billion).”
Regarding the allusion made by UAE President Mohammed bin Zayed Al Nahyan to “When asked why he chose to invest in South Korea, Lee cited his “trust in the Republic of Korea” and noted that a number of events had occurred in the 14 years since the Barakah nuclear plant’s order was made in December 2009. The UAE has enormous faith in Korea because of its dedication over the previous ten years, which is a miracle.”
The focus of investments will be on solar, hydrogen, nuclear, and defense technologies. Lee said, “In addition to existing nuclear power, we will be invested in the development of high-level next-generation nuclear power plants, such as small modular nuclear power plants (SMRs),” and “Other fields, such as hydrogen, wind power, solar power, renewable energy, and defense were specifically mentioned.”
Abu Dhabi Investment Authority, Mubadala Investment Company, and Abu Dhabi Development Holding Company are a few of the largest sovereign wealth funds in the world. Mubadala is likely to be the main focus of investments, but there are numerous other funds that can make investments as well. The two nations intend to start by building a framework for investment implementation so that investments can move forward seamlessly and quickly with work.
“As President, I will take care of this investment not just for the return on investment, but also for the sustained medium- and long-term development of the UAE,” said President Yun in response to President Al Nahyan’s decision to make a significant investment. President Al Nahyang responded to President Yun’s invitation to South Korea by saying, “My heart already considers South Korea to be a “second home.” I’m excited to go to Korea shortly.”
Also signed were a number of memorandums of understanding (MOUs). In the presence of the two chiefs of state, just 13 MOUs were signed. The UAE national wealth fund would invest heavily in hydrogen, nuclear power, defense, and energy, according to the MOU. It is believed that South Korea’s interest in using exports to fight the global economic slowdown and the UAE’s aspirations for more than just “oil money” are linked.
The UAE must use its “oil” to construct future energy infrastructure, most notably nuclear energy and hydrogen, as it gets ready for the “post-oil era.” The UAE is trying to expand beyond establishing its own nuclear power project and join forces with South Korea to jointly enter a third country. The UAE currently owns the Baraka nuclear power station that South Korea exported. The Memorandum of Understanding (MOU) for the Net Zero Acceleration Program was signed in this regard. SMR technology development was among these.
The Hyundai Motor Group of South Korea has also signed contracts in the hydrogen industry, a sector in which it excels. A “Memorandum of Understanding on Hydrogen Production, Storage, Transportation and Utilization in Cities” was signed by Ministers of Land, Infrastructure, and Transportation Won Hee-ryong and Suhail Mazruai. Although the UAE has a significant oil industry, it has started to plan for the future of energy.
Korea will also support the “Korea-UAE International Joint Stockpile Project,” which states that Korea will exercise preferential purchasing rights for contract volumes in the event of a domestic oil supply and demand crisis. Korea, which is still the world’s fifth-largest importer of crude oil, considers it necessary to import oil steadily. Cooperation is also anticipated to grow in the area of defense. The Memorandum of Understanding on Strategic Defense Industry Cooperation was signed by the Director General of the Korean Defense Projects Agency and Tawajun, the Secretary-General of the UAE Economic Council.
In his remarks about the summit’s importance during the state visit, Lee noted that “the two heads of state have built trust and strengthened cooperation in all directions other than the existing nuclear power plants and infrastructure.” He continued, “It is also meaningful that by succeeding in attracting large-scale investment from the UAE through summit diplomacy, we have created substantial results of the economy-oriented summit diplomacy that President Yun stressed.”
