UAE signs far-reaching pact to boost South Korean trade

Abu Dhabi: The UAE and South Korea signed a series of wide-ranging agreements to boost energy, economic and technological ties which Shaikha Lubna Al Qasimi, Minister of Economy, said will help catapult trade cooperation between the two to new heights.

The agreement encourages companies to explore joint projects in several industries through project financing and the removal of trade barriers.

According to the MoU, the two countries agreed to consider possible investments in logistics and distribution, supply of crude oil and petroleum products, marine transportation, petrochemicals and construction and services.

Gulf Arab oil producers like the UAE are looking to invest in the downstream sector in Asian countries.

Strategic stockpile

Shaikha Lubna, who signed the deal with Korean Minister of Commerce, Industry and Energy Chung Sy Kyun, said: "The two countries harbour huge trade and economic potentials and rich business opportunities which provide a favourable ground for expansion of economic cooperation and establishment of joint investment ventures, especially between private sectors."

UAE Energy Minister Mohammad Bin Dha'en Al Hamili said the country was studying a proposal by South Korea for it to help supply crude oil for its strategic stockpile.

Last December, South Korea discussed the proposal with Hamili and the head of state oil firm Abu Dhabi National Co Yousuf Omair Bin Yousuf. In September, South Korea said it would look to seal more international joint stockpiling agreements. Deputy Energy Minister Oh Young-ho had said Saudi Arabia was one of two states with which South Korea was discussing possible joint stockpiling. Seoul already has similar deals with Algeria and Norway.

A joint oil-stockpiling deal between Opec producers and major consuming nations would give producers like those in the Gulf located at least a month's journey away from key markets an easy, quick and profitable way to address any shortages.

Consumer governments would buy rights to use the oil in emergencies, enabling them to head off any sudden supply outages.