Foreign direct investment (FDI) in Korea reached a record high level in 2012, as confidence in the Korean economy improved due to free trade agreements with the US and EU, and also as a result of the upgrading of the nation’s sovereign credit rating. FDI inflows (notification basis) last year amounted to US$16.26 billion, up 18.9 percent from the previous year. Investment from the Greater China region (China, Taiwan, Hong Kong, Singapore, Malaysia) surged 107 percent, while FDI inflows from the US and Japan rose 55 percent and 98 percent, respectively. However, investment from the EU decreased 47 percent from the previous year. The rise in FDI inflows is expected to help create 100 thousand jobs in the next three years and revitalize the economy at a time when domestic investment has been faltering. It will also boost the competitiveness of domestic industries by offsetting the weaknesses in the economy’s value chain. FDI in 2013 is expected to be slightly lower than in 2012, but the government will make efforts to attract investment in major job-creating projects such as resorts and global research and development (R&D) centers.

* Source : Ministry of Strategy and Finance and Korea Development Institute, Economic Bulletin Vol.35 (January 2013).
Website: http://english.mosf.go.kr