South Korea, Saudi Arabia sign $8 billion economic co-operation pact during Crown Prince Mohammed bin Salman's first visit to Seoul

Seoul: South Korea and Saudi Arabia signed an $8.3 billion economic co-operation pact on Wednesday during Crown Prince Mohammed bin Salman's first visit to Seoul, as the oil-rich kingdom looks eastward following Western criticism over journalist Jamal Khashoggi's murder.

Saudi Arabia is resource-poor Seoul's biggest oil supplier and most of the agreement is accounted for by a $6 billion deal between oil giant Saudi Aramco and Korean firm S-Oil to build a refinery and downstream facilities in South Korea.

 South Korea, Saudi Arabia sign  billion economic co-operation pact during Crown Prince Mohammed bin Salmans first visit to Seoul

File image of Saudi Arabia's Crown Prince Mohammed bin Salman. AP

A giant banner welcoming the crown prince was hung on the Seoul headquarters of S-Oil, South Korea's third-biggest refiner, which is majority-owned by Saudi Aramco.

Saudi Arabia is South Korea's "biggest construction market overseas, the largest investor in the country among countries in the Middle East and also the biggest trading partner in the region," President Moon Jae-in said at a meeting with Prince Mohammed.

The welcome offered to the crown prince in Seoul sits in contrast to the global outcry over the Khashoggi killing and is part of Saudi Arabia's wider diplomatic charm offensive in Asia.

Prince Mohammed, the kingdom's de facto leader, visited Pakistan, India, and China in February, and is scheduled in Japan later this week to attend the G20 summit in Osaka.

Khashoggi, a fierce critic of the prince, was killed at the Saudi consulate in Istanbul in October, a murder that tarnished the image of the kingdom and of the crown prince in particular. Riyadh initially denied the killing, then gave several conflicting accounts of Khashoggi's death, and now claims he died in an unauthorised operation that did not involve Prince Mohammed.

The murder sparked global indignation, with US lawmakers pushing for Washington to distance itself from the crown prince, but the White House has maintained close relations with Riyadh, a major ally in the Middle East.

A Blue House spokeswoman told reporters Wednesday that Moon had "no plans" to discuss Khashoggi's death with the visiting prince. The economic pact also involved several other deals between Saudi Aramco and Korean firms, including Korea National Oil Corporation, Hyundai Heavy Industries, and carmaker Hyundai Motor.

The crown prince also met with the heads of the country's biggest conglomerates, including Samsung heir Lee Jae-yong. Prince Mohammed aims to diversify his country's heavily oil-dependent economy and to sell up to five percent of Saudi Aramco — the world's largest energy firm.

Proceeds from the sale — which aims to raise up to $100 billion — will help create the world's biggest government investment fund, whose profits could provide an alternative to oil revenues.

Updated Date: Jun 26, 2019 17:19:42 IST