Korea becomes No. 1 investor in United States for the first time

Home > Business > Industry

Korea becomes No. 1 investor in United States for the first time

Published: 19 Sep. 2024, 16:51

SARAH CHEA
[email protected]

Audio report: written by reporters, read by AI

U.S. President Joe Biden calls for tripling tariffs on Chinese steel imports while speaking at the United Steel Workers Headquarters in Pittsburgh, Pennsylvania, on April 17. [EPA/YONHAP]

Korea emerged as the top investor in the United States, mostly due to the Biden administration’s clean energy projects and the intensifying U.S.-China trade dispute.

Korean companies committed to 90 large-scale projects in the United States totaling $21.5 billion last year, beating Taiwan, according to a recent report from the Financial Times citing data from the United Nations Conference on Trade and Development.

This is the first time Korea secured the No. 1 spot. Canada ranked second while Germany was No. 3, followed by Britain and Japan.

China, which was the top U.S. investor in 2014, moved down to eighth place last year amid growing tensions between Washington and Beijing on exports, according to the report.

A rendered image of Hyundai Motor's EV plant in Georgia, which will start operation in October. [HYUNDAI MOTOR]

Korea’s increasing commitment to the United States comes with Biden’s strong push for climate change policies represented by the Inflation Reduction Act, which includes up to $7,500 in tax credit to EVs assembled in the North American region.

Market tracker fDi Markets said more than one-third of Korean investments in the United States last year were related to the automotive and auto parts sectors.

Hyundai Motor announced last year a $4.3 billion investment with LG Energy Solution to build an EV battery plant in Georgia, the largest single investment in the state.

Samsung SDI also said last year it will pour $3.5 billion together with General Motors to construct an EV battery plant in Indiana.

Many U.S. laws, including the CHIPS Act, aim to reduce reliance on Chinese goods and hinder foreign companies from using them to qualify for incentives.

Korea’s investment in China has sharply reduced in recent years. Of Korea’s total overseas investments in 2019, 11 percent went to China. That, however, was cut to less than 1 percent last year.

During the same period, Korea’s investment to the United States jumped to over 50 percent from 18 percent.

BY SARAH CHEA [[email protected]]