Korea second in survey on foreign investment

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Korea second in survey on foreign investment

Korea ranked No. 2 among seven Asian countries in terms of its investment attractiveness to foreign companies, a survey from the state-funded Korea Trade-Investment Promotion Agency (Kotra) showed.

Kotra said yesterday that the country received 7.03 out of 10 points on the survey, the second-highest behind Singapore. The agency surveyed 243 companies across 21 countries in 28 categories, which included questions on the countries’ tax systems, labor costs and safety measures, among others.

Hong Kong took No. 3 in terms of investment appeal, followed by Japan, Taiwan, China and Malaysia.

Korea was No. 1 in social infrastructure and No. 2 in terms of its market, including market size, growth potential and accessibility to other countries. It also ranked second in terms of R&D and innovation, a section that focused on government support, technology levels and patent protection.

“We should recognize that foreign companies have rated us highly in our accessibility to China and Japan, and also our free trade agreement network,” Kotra said in a statement.

However, foreign companies felt that Korea is below average in financing, government administration and social and political stability, the survey showed.

The top scorer, Singapore, led in terms of its living environment, political and geographical factors and government administration. Hong Kong was No. 1 in financing and taxes while Japan had the best scores in R&D and innovation, the survey showed.

China led in market size, growth potential and labor resources but was the lowest in R&D, administration, financing and political and geographical factors, indicating that foreign companies think the country lacks the “software” needed to do business there, according to Kotra.

“When we talk with foreign investors, they generally measure between two and three Asian countries as their target, so competition to bring investment is intense,” said Commissioner Han Ki-won, who heads Kotra’s Invest Korea organization. “We will monitor competing Asian countries’ investment environments and try to use factors Korea is better at than others.”

Among the companies Kotra surveyed, 113 were based in Asia while 89 were European.

BY JOO KYUNG-DON [kjoo@joongang.co.kr]

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