Foreign direct investment hits record in first 9 months of year

Deputy Minister of Trade and Investment Moon Dong-min announces the foreign direct investment at the government complex in Sejong on Wednesday. [MINSTRY OF TRADE, INDUSTRY AND ENERGY]

Foreign direct investments pledged this year through the end of September hit $21.5 billion, up 18.2 percent on year.

According to the Ministry of Trade, Industry and Energy on Wednesday, this is a record for the first nine months of the year.

It was also the first time the statistic was above $20 billion in the first nine months of the year.

"This is an outstanding performance considering the numerous external uncertainties, including global inflation and interest rate increases," said Moon Dong-min, deputy minister for trade and investment.

The government cited a surge in investment in Korean manufacturing, particularly in semiconductor, electric vehicle and battery companies.

Investment in manufacturing was $7.8 billion, a 152 percent increase year-on-year.

Foreign direct investment in services fell 11.5 percent to $12.7 billion.

"During President Yoon's visit to the U.S. last month, $1.15 billion of high quality investments, including investments in semiconductors, R&D centers for EVs and wind-power generator complexes, which are connected to the government's industry and energy policies, were made," said Moon.

He added that the government's continuing efforts to attract foreign investment and Korea's strong manufacturing foundation, good workforce and innovative technologies helped in achieving the record.

By country, investment from the U.S. was up 115.9 percent to $7.1 billion, and from Japan 42.9 percent to $1 billion.

Foreign direct investments from the EU was $3.3 billion, down 55 percent, and from China $4.4 billion, down 15 percent.

The government blamed major investments last year by European companies for the fall.

According to the ministry, a German company invested $2.1 billion last year, while an Irish company invested $1.8 billion.

The government also stressed that while investment from greater China shrunk, investment from mainland China increased 15.4 percent year-on-year.

Greenfield foreign direct investment increased 24.4 percent to nearly $14 billion, while M&A grew 8.3 percent to $7.6 billion.

"The government will continue to work on creating a good investment environment for businesses," Moon said. "We plan to provide competitive tax benefits."

The ministry official said the Russia-Ukraine war is one of the biggest concerns.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]