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FDI pledges to Korea fall nearly 10% in Q1 amid uncertainty

Published: 03 Apr. 2025, 18:15

PARK EUN-JEE
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Industry Minister Ahn Duk-geun speaks during an event in Seoul on Jan. 14. [MINISTRY OF TRADE, INDUSTRY AND ENERGY]

Foreign direct investment (FDI) pledges to Korea fell 9.2 percent in the first quarter from a year earlier amid economic uncertainties at home and abroad, the Ministry of Trade, Industry and Energy said Thursday.

Korea received $6.41 billion worth of FDI commitments in the January-March period, compared with $7.05 billion logged a year earlier, according to the industry ministry.

This year's reading still marked the second-largest amount ever following a record figure logged in the first quarter of 2024.

The amount of investment that actually arrived in Korea surged 26.4 percent over the period to $3.51 billion in the first quarter of 2025, the ministry said.

"The quarterly decline [in fresh commitments] was attributed to the base effect of last year's record performance and uncertainties arising from the Donald Trump administration's new policy measures. A decrease in U.S. dollar-denominated investments due to the depreciation of the local currency also led to the fall in FDI pledges," the ministry said in a release.

By industry, the manufacturing segment garnered FDI pledges worth $2.33 billion in the first quarter, down 24.5 percent from a year earlier.

FDI pledges in the service sector dipped 7.4 percent to $3.56 billion.

By investor, the United States pledged to make $830 million worth of investments in the first quarter, up 15 percent on year.

FDI pledges from the European Union more than doubled, spiking 163.6 percent on year to $1.49 million, while those from China dropped 75 percent to $330 million, the data showed.

Yonhap