HHI, Hyundai, Saudi-Aramco, Chung Ki-Sun, Amin al-Nasser
Amin al-Nasser, president and CEO of Saudi Aramco with Chung Ki-sun, executive vice president of Corporate Planning Office of HHI (Photo: Hyundai)
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Facing immense financial and operational p[ds_preview]roblems, South Koreas shipbuilding group Hyundai Heavy Industries (HHI) aims to create new business opportunities by joining a huge maritime industry complex in Saudi-Arabia.

On the occasion of the inauguration of »King Salman Global Maritime Industries Complex« in Ras Al-Khair, Hyundai stated to take part in terms of delivering shipbuilding expertise. In addition, the parters aim to look for further ways of cooperation, it was said.

King Salman Global Maritime Industries Complex, being executed as part of the country’s growth and economic diversification strategy ‘Vision 2030’, is Saudi Arabia’s first national industrial project that is named after King Salman. According to the statement, the ceremony was a follow-up of the MOU for New Business Opportunities Collaboration signed in November 2015 between HHI, Saudi Aramco, Lamprell and Bahri for businesses including the maritime yard, marine engine and industrial plant. Under the MOU, HHI plans to pursue the cooperation with the establishment of a joint venture with the parties.

Hyundai‘s Chung Ki-sun who is leading the project on HHI side said, »We will make our utmost efforts not just to make this occasion an opportunity to serve as a stepping stone for the take-off of our business, but also to make contributions to the economic development of Saudi Arabia. We will follow the successful example of the King Fahd Industrial Seaport in Jubail that HHI built about 40 years ago and has been playing a leading role for the development of Saudi Arabia.«

Upon completion, the USD 4.3 billion project aiming to build a 4.96 million square meter maritime complex at the site would not just be able to build commercial ships and offshore facilities, but also to provide ship repair service by 2021. Another HHI official was quoted, »Once completed, we see the development of the complex will be accelerated through the transfer of HHI’s shipbuilding expertise and shipyard operating know-how.«

No insights on state support

Hyundai as well as its big Korean competitors Daewoo (DSME) and Samsung (SHI) are struggling hard with the slump in global newbuilding activity. All three of them need to cut workforce and to sell several business units. The government in Seoul already announced to plan a 8 bn $ investment program, including the ordering of up to 250 vessels until 2020. As well, the main lenders Korea Developement Bank and the Korea Export-Import Bank (Kexim) are putting pressure on the shipbuilding conglomerates. However, it is not clear, whether the state or the banks are involved in the cooperation project of Hyundai and the Saudi-Arabian companies.