South Korean appetite for Saudi projects grows
22 March 2024
Register for MEED's guest programme
South Korea's construction market is expected to contract by 4.5% in 2024 and by 0.7% in 2025, owing to a sustained, sharp decline in the number of building permits issued, according to a report by GlobalData.
The expected decline in construction activity is likely to lead to South Korean contractors seeking orders from international markets. Seoul has actively targeted the Saudi market for new orders, specifically on the kingdom's gigaprojects such as Neom.
In 2022, Seoul formed a task force to help South Korean contractors win work on infrastructure projects in Saudi Arabia. The group, known as One Team Korea, is made up of the Land, Infrastructure & Transport Ministry; Overseas Infrastructure City Development Corporation; the Korea Trade-Investment Promotion Agency; and the Overseas Construction Association.
In December 2022, Saudi Arabia’s Public Investment Fund (PIF) secured its first financing arrangement backed by South Korean export credit agency the Korea Trade Insurance Corporation (K-Sure) as part of a strategic alliance to boost the export of South Korean goods and services into the PIF's various projects and subsidiaries. The $3bn term loan can increase to $5bn and has been provided by a consortium of nine leading international lenders. It is guaranteed by K-Sure.
Seoul’s efforts are producing results. In 2023, South Korean main contractors secured contracts totalling $7.2bn in Saudi Arabia. The total was the best on record since 2013, when there was $14.2bn of contract awards. So far in 2024, there has been $1.4bn of contract awards.
Domestic outlook
As the value of contracts secured in Saudi Arabia rises, the outlook for South Korea’s domestic market remains challenging. According to the Korean Statistical Information Service, the total number of construction permits issued fell by 25.3% in 2023, while the total gross floor area for which construction permits were issued declined by 25.6%. Residential building permits alone declined by 30.6% in 2023, following an annual decline of 14.5% in 2022.
Over the remainder of the forecast period, between 2026 and 2028, the construction industry is expected to record an average annual growth rate of 2.7%, supported by investment in the manufacturing industry, transport and renewable energy infrastructure, and the government’s easing of housing redevelopment and reconstruction regulations.
The industry’s growth during that period will also be supported by the government’s plan to invest KRW9.2tn ($7bn) by 2025 in wind, solar and hydrogen infrastructure and construct 12GW of offshore wind capacity by 2030.
In addition, the government plans to invest KRW134tn ($102bn) by 2028 in developing the GTX project, a new suburban rail network in the Greater Seoul area.
Further support for growth will be generated by Samsung Electronics and SK Hynix’s plan to develop the world’s largest chipmaking cluster, with the companies planning to invest a combined KRW627.2tn ($477.5bn) by 2047.
Register for MEED's guest program now to access this article.
Exclusive from Meed
All of this is only 1% of what MEED.com has to offer
Subscribe now and unlock all the 153,671 articles on MEED.com
- All the latest news, data, and market intelligence across MENA at your fingerprints
- First-hand updates and inside information on projects, clients and competitors that matter to you
- 20 years' archive of information, data, and news for you to access at your convenience
- Strategize to succeed and minimise risks with timely analysis of current and future market trends
Related Articles
-
Sabic and Ceer to collaborate on electric vehicle manufacturing22 July 2026
Saudi Basic Industries Corporation (Sabic) and Ceer, Saudi Arabia’s first electric vehicle (EV) brand and original equipment manufacturer, have signed a memorandum of understanding (MoU) to evaluate mutually beneficial commercial opportunities and define the terms of potential collaboration.
The MoU provides a framework for developing innovative solutions and products by evaluating the possible use of Sabic's advanced materials in some Ceer vehicle applications and jointly developing material and processing solutions that fulfill industry needs.
It also aims “to share knowledge and experience in sustainability and technology to support Ceer objectives in product development, and to explore potential strategic sourcing opportunities [to build] a local supply chain with global standards for the emerging local EV sector, as well as to identify and pursue additional areas of mutually agreed collaboration”, Sabic said in a statement.
The MoU was signed on 21 July at Sabic's headquarters in Riyadh by CEO and executive board member Faisal Mohammed Alfaqeer and James DeLuca, Ceer’s CEO.
Sabic has been one of the world's leading producers of advanced materials and solutions used in EV manufacturing for decades.
In 2022, Ceer and Saudi Arabia’s National Industrial Development and Logistics Programme announced contributing to the efforts to accelerate the global transition to electrification by supporting the development of safe and scalable EVs, along with providing advanced thermoplastics, design expertise and engineering capabilities. The initiative also focuses on enabling lightweight, cost-effective solutions that meet stringent safety and performance standards while helping reduce environmental impact.
Ceer will continue to leverage these advanced technology innovations to accelerate the development of the Saudi automotive industry, contributing to the creation of a highly competitive, integrated and sustainable local EV ecosystem.
READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDFStress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.
Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
> AIRPORTS: Dubai and Riyadh reaffirm airport ambitions> INDUSTRY REPORT: Dubai eyes tourism sector recovery> DATA CENTRES: Big Tech falls short on data centre promise> LEADERSHIP: Aramco’s citizen developers accelerate digital changeTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/17727364/main3327.jpg -
Adnoc initiates oil production project at key offshore block22 July 2026
Abu Dhabi National Oil Company (Adnoc Group) and its international partner, Pakistan International Oil (PIOL), have initiated a project to produce oil from Offshore Block 5 in Abu Dhabi’s waters, in which they are both stakeholders.
Adnoc, the leader on the project, intends to execute it through a front-end engineering and design (feed) competition, according to sources.
The Abu Dhabi energy giant recently selected the following three contractors for the Offshore Block 5 feed competition:
- CNPC Offshore Engineering Co (China)
- Saipem (Italy)
- Sinopec (China)
Offshore Block 5 covers 6,223 square kilometres in Gulf waters near the Zakum field and is located 100 kilometres northeast of the city of Abu Dhabi.
Abu Dhabi’s Supreme Council for Financial & Economic Affairs awarded a production concession agreement for Offshore Block 5 to Adnoc and PIOL in June 2025, with Adnoc holding the majority 60% participating interest and PIOL the other 40%.
Prior to that, Adnoc had signed an exploration concession agreement in August 2021 with PIOL, which is a consortium of four Pakistani state-owned companies – Pakistan Petroleum, Mari Petroleum Company, Oil & Gas Development Company and Government Holdings (Private).
The Pakistani consortium is understood to have invested up to $304.7m in exploration and appraisal drilling, including a participation fee, to explore for and appraise oil and gas opportunities in Offshore Block 5.
Potential oil production from Offshore Block 5 is expected to contribute to Adnoc Group’s objective of achieving an oil production capacity of 5 million barrels a day (b/d) by 2027 – a campaign known as Accelerated Integrated Programme 5. The Abu Dhabi energy giant currently has a spare capacity of 4.85 million b/d.
Pakistan, which is heavily reliant on energy imports for its economy, will also benefit from potential oil production by its companies from the Abu Dhabi concession.
ALSO READ: Adnoc announces FID on $6.2bn Umm Shaif gas cap project
READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDFStress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.
Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
> AIRPORTS: Dubai and Riyadh reaffirm airport ambitions> INDUSTRY REPORT: Dubai eyes tourism sector recovery> DATA CENTRES: Big Tech falls short on data centre promise> LEADERSHIP: Aramco’s citizen developers accelerate digital changeTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/17726345/main.jpg -
Chinese contractor appointed for 500MW Oman solar plant22 July 2026
China's Shanxi Installation Group has secured an estimated $222m engineering, procurement and construction (EPC) contract for the 500MW Al-Kamil 1 solar independent power project (IPP) in Oman.
In a filing on the Hong Kong stock exchange, the company said the deal marks its first major project in the Middle East.
The contract covers the EPC, grid connection, testing and commissioning of the utility-scale solar photovoltaic (PV) plant, as well as 2.5 years of operations and maintenance.
A consortium comprising France's EDF Power Solutions, Oman National Engineering & Investment Company and OQ Alternative Energy signed the power purchase agreement for the project with Nama Power & Water Procurement Company (Nama PWP) in June.
Nama PWP is the sole procurer of new electricity generation capacity in Oman.
The Al-Kamil 1 solar IPP is EDF Power Solutions' third renewable energy project in Oman, following the 500MW Manah 1 solar PV IPP and the 120MW JBB wind IPP.
As MEED has previously reported, the Al-Kamil 1 project is part of Nama PWP's renewable energy development pipeline, which also includes the 400MW Sinaw and 280MW Marsa solar IPPs.
Nama PWP is currently tendering supervisory services for the Marsa IPP, with a bid submission deadline of 26 July.
The pipeline also comprises the 800MW Mahout and 300MW Duqm 2 wind IPPs, both targeted for commissioning between 2027 and 2029.
READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDFStress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.
Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
> AIRPORTS: Dubai and Riyadh reaffirm airport ambitions> INDUSTRY REPORT: Dubai eyes tourism sector recovery> DATA CENTRES: Big Tech falls short on data centre promise> LEADERSHIP: Aramco’s citizen developers accelerate digital changeTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/17725741/main.jpg -
Fluor wins feed contract for key Bahrain aromatics facility22 July 2026
Bahrain’s Gulf Petrochemical Industries Company (GPIC) has awarded US-based consultant Fluor a contract for front-end engineering and design (feed) on an aromatics facility in the country.
The project will be an expansion of GPIC’s existing petrochemicals facility in Bahrain’s downstream complex in Sitra, which produces ammonia, urea and methanol.
The new aromatics facility will utilise “commercially-proven process technologies” to produce approximately 1.2 million metric tonnes a year (t/y) of paraxylene and 500,000 metric t/y of benzene, Texas-headquartered Fluor said.
Paraxylene and benzene are critical building blocks for plastics, polyester fibers and packaging materials, supporting global demand for high‑performance consumer and industrial products.
Founded in 1979, GPIC is a joint venture of Bahraini state energy enterprise Bapco Energies, known at the time as Nogaholding; chemicals giant Saudi Basic Industries Corporation (Sabic); and Petrochemical Industries Company – a subsidiary of state energy conglomerate Kuwait Petroleum Corporation. The three partners hold equal stakes of 33.3% in GPIC.
GPIC utilises locally available natural gas as feedstock to manufacture high-quality chemicals and fertilisers for domestic consumption and export, including 1,200 metric tonnes a day (t/d) of ammonia, 1,200 metric t/d of methanol and 1,700 metric t/d of granular urea.
ALSO READ: Bahrain taps consultants for studying use of nuclear power
READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDFStress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.
Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
> AIRPORTS: Dubai and Riyadh reaffirm airport ambitions> INDUSTRY REPORT: Dubai eyes tourism sector recovery> DATA CENTRES: Big Tech falls short on data centre promise> LEADERSHIP: Aramco’s citizen developers accelerate digital changeTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/17725737/main1255.jpg -
Firms submit bids for second Hassyan SWRO pipeline contract22 July 2026
Dubai Electricity & Water Authority (Dewa) has received bids from three contractors for a second pipeline contract relating to the Hassyan seawater reverse osmosis (SWRO) network expansion.
Project two requires contractors to supply, install, test and commission glass-reinforced epoxy (GRE) water transmission pipelines and associated works for the plant's phase two network.
Local firm Tristar Engineering & Construction submitted the lowest offer of AED792.59m ($215.8m), according to tender results published by the state utility.
Green Oasis General Contracting (UAE) submitted a bid of AED800.02m ($217.8m) and Wade Adams Contracting (UAE) made the other compliant offer of AED989.65m ($269.5m).
In January, Dewa announced that construction of the 180-million-imperial-gallon-a-day phase one of the Hassyan SWRO independent water project was 90% complete.
Earlier in July, eight contractors submitted bids for project one of the Hassyan pipeline network expansion.
Dewa also has a third contract out for tender for GRE water transmission pipeline work related to the Hassyan SWRO phase two network.
Project three was tendered on 26 January and has a bid submission deadline of 29 July.
READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDFStress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.
Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
> AIRPORTS: Dubai and Riyadh reaffirm airport ambitions> INDUSTRY REPORT: Dubai eyes tourism sector recovery> DATA CENTRES: Big Tech falls short on data centre promise> LEADERSHIP: Aramco’s citizen developers accelerate digital changeTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/17723861/main.jpg