Recorded $27.5 billion… Investments in new industries and environment increase, and small managers slightly decrease
(Sejong = Yonhap News) Reporter Kim Joo-hyung = Park Jeong-wook, the Ministry of Trade, Industry and Energy Investment Policy Officer, is presenting the 2020 foreign direct investment trend at the Sejong City Government Complex on the morning of the 12th. [email protected]
(Seoul = Yonhap News) Reporter Boram Yoon = Last year, foreign direct investment (FDI) in Korea decreased by more than 11% in the aftermath of the novel coronavirus infection (Corona 19), but he saved more than 20 billion dollars for six consecutive years.
The Ministry of Trade, Industry and Energy announced on the 12th that FDI in 2020 was $2.75 billion, down 11.1% from the previous year.
In terms of actual investment arrival, it fell 17.0% to $11.9 billion.
FDI declined significantly (-22.4%) in the first half of the year when the spread of Corona 19 began in earnest, but declined to 2.8% in the second half, showing a recovery trend.
FDI has declined for the second year in a row since 2018, a record high. However, in the case of last year, it was investigated that Korea’s performance was relatively good while the global FDI contracted significantly due to the aftermath of Corona 19.
The United Nations Conference on Trade and Investment and Development (UNCTAD) predicts that in 2020, the global FDI will decrease by 30-40% compared to the previous year. In fact, in the first half of last year, the global FDI amounted to 3990 billion dollars, down 49% from the same period last year (777 billion dollars).
An official from the Ministry of Industry said, “Even in the global economic crisis caused by Corona 19, it has attracted FDI of 20 billion dollars for six consecutive years, confirming that it is a safe investment destination.”
Last year’s FDI is characterized by increased investments in new industries related to the 4th industrial revolution, such as artificial intelligence (AI), big data, cloud, eco-friendly cars, and bio.
The reported-based investment in the field was $8.42 billion, an increase of 9.3% from the previous year, and the share of the total investment (40.6%) also increased by 7.6 percentage points (p).
In major cases, investments were made in expanding data centers, upgrading fresh food ingredients cold chain (refrigerated distribution) logistics systems, and developing anti-cancer and immune treatments for rare diseases such as ovarian cancer and pancreatic cancer.
Investment in high-tech materials, parts, and equipment (miniature managers), such as semiconductors, secondary batteries, and eco-friendly car parts, declined 7.0% to $3.81 billion as reported. However, the share of the total investment increased by 1.2 percentage points to 18.4%.
Investment in the general manager sector dropped a whopping 43.7% in the first half, but increased 30.9% in the second half, easing the annual decline.
Investments were made in the production of vacuum pumps for semiconductors and displays, gas processing equipment, construction of a battery pack production plant for electric vehicles, and the development and production of photoresist for EUV, which is a Japanese export control item.
Investments in new and renewable energy such as wind power and solar power and green industry-related fields such as water treatment and resource recycling were $480 million as reported, an increase of 101.4% from the previous year.
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There have also been a total of 7 cases (worth 100 million dollars) of investment reports using undisposable retained earnings of existing foreign-invested companies.
Since August of last year, the government revised the Foreign Investment Promotion Act to reflect this as foreign investment if a foreign company that has already invested in Korea reinvests undisposable retained earnings.
By country, investment in Chinese countries such as China, Hong Kong, Singapore, Taiwan, and Malaysia was reported at $5.46 billion, an increase of 26.5% from the previous year.
Among them, China’s reported investment amount rose 102.8% to 1.93 billion dollars.
On the other hand, the United States ($5.3 billion), the European Union (EU, $4.72 billion), and Japan ($730 million) declined 22.5%, 33.8%, and 49.1%, respectively.
Japan’s investment decline is largely due to the impact of Corona 19 and the base effect of a large-scale merger and acquisition (M&A) worth $500 million in 2019, the Ministry of Industry explained.
UNCTAD predicted that this year’s global FDI will decline further by 5-10%, and will only recover after next year.
It is predicted that the contraction of investment sentiment will be maintained for the time being due to uncertainties in the global economy, such as the prolonged economic recession following the re-proliferation of Corona 19, the launch of a new US government, and the realization of Brexit (UK’s withdrawal from the EU).
An official from the Ministry of Industry said, “Korea also attracts FDI this year due to the existence of positive factors such as the recognition of stable investment destinations according to K-Defense, broad free trade agreement (FTA) network, high external credit rating, and negative factors such as the continued uncertainty of Corona 19 and intensifying competition for technology hegemony in the US and China. “It won’t be easy.”
The government plans to focus on attracting investment from high-tech companies by proactively discovering companies with high potential for future growth and providing customized incentives for the transition to FDI Plus.
In addition, the’Advanced Investment Zone’ was created to provide additional subsidies and special cases for using the site along with the existing location benefits.
It has decided to actively expand online IR platforms and discover and resolve investment difficulties.
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2021/01/12 11:46 sent