As part of expanding the economic cooperation between the UAE and South Korea, the former shall invest $30 billion in South Korean Industries. These would include strategic sectors like defense, hydrogen fuel, energy sector, and nuclear power.
The decision was announced at a summit conducted on Sunday between the UAE President His Highness Sheikh Mohamed bin Zayed Al Nahyan and South Korean President Yoon Suk-yeol at Qasr Al Watan Presidential Palace in Abu Dhabi.
The Decision was Announced On Monday
This is the first time that a leader from South Korea is visiting the UAE after their four-decade-long diplomatic relationship established in 1980. The UAE President Sheikh Zayed Al Nahyan said that the Emirate nation has decided to invest $30 billion in South Korea on the basis of trust that it will keep its promises towards the UAE.
This whole amount will be distributed in various sectors using sovereign wealth funds that include investments from the Mubadala Investment Company and this will be the single largest overseas investment by the UAE in any country.
At the summit meeting, the two countries made several other agreements and around thirteen memorandums of understanding. One of the main agreements was between the Abu Dhabi state fund Mubadala and Korean Development Bank to make combined investments in several South Korean companies.
Apart from the investments in the strategic sectors, there will also be cultural and personnel exchanges between the two nations that will further strengthen the diplomatic bond.
South Korean President Yoon is on a four-day trip to the UAE together with the delegates of around a hundred Korean companies and top company executives of some major business giants like Samsung Electronics Co.’s Jay Lee, SK Inc’s Chey Tae-Won and Hyundai Motor Co’s Chung Euisun. According to experts, this huge investment will also help South Korea’s financial and stock markets to perform better in the context of the global recession.
One of the main business cooperation will be in the area of nuclear energy and specifically focusing on Barakah Nuclear Plant, which is the UAE’s first nuclear power station. The power plant started its construction in 2012 and is currently operating at half capacity. It is a four-reactor nuclear power plant and is one of the most ambitious clean energy projects in the UAE.
It is for the first time that Korea is also investing in a nuclear power plant construction project overseas and the Korean-type nuclear reactors 1 and 2 at the Barakah plant are capable of producing electricity to cover almost 60 percent of Abu Dhabi’s power requirements.
Other than the investment deal with South Korea, UAE has also signed multiple investment deals with countries like the UK ($12.2 billion), France ($1.63 billion), and China ($5 billion). These investment deals are part of the larger vision of the UAE to expand its business sector globally and to invest in a fortified non-oil economy that will turn out to be the future of the Emirate nation.
Apart from overseas investments, the UAE has been creating quite a stir in the local investment sector too. Dubai, one of the major destinations for investments, recorded an impressive 492 Foreign Direct Investment Projects in the first half of 2022. These FDI investments created around 15,164 new jobs in the Dubai economy, which was a sharp 33.5 percent year-on-year growth.
After the Covid-19 rebound, Dubai has been considered to be a safe haven for investors from other nations as it is providing major benefits and a solid economy to build new businesses. The vision of the wise leaders of the UAE is being materialized in the form of high scale local and global investments and inspiring economic growth even when the rest of the world is going through a tight economic crisis.
The UAE’s well-planned economic strategies coupled with its expansion plans to non-oil sectors have created a fertile environment for new and innovative businesses to come and invest in the UAE. This is evident in the majority of investment decisions and MoU’s signed with several other nations in Asia, Europe, and America.
Dubai and the UAE have been under the global spotlight for quite some time now with some major global events to their credit like the Dubai Expo 2020, GITEX GLOBAL tech exhibition 2022, etc. These events helped increase investor confidence in the Emirate and also created a wider outlook toward the economic possibilities of the UAE.
This year, COP28 will be another major global conference that will be conducted at Expo City, Dubai. It will be a platform where delegates from all major nations would be present to discuss and initiate some important decisions regarding lowering carbon emissions and creating clean energy sources for a sustainable future.
Overall, the summit between the UAE and South Korea is definitely a new chapter in the diplomatic relationship between the two nations and it is also one of the major economic decisions that will encourage other overseas economies to have a mutual investment agreement with the UAE.