ΆΓ Foreign investment rises in manufacturing sector

 KoreaHerald 2000.09.07

    Foreigners made direct investments worth $1.499 billion in Korea last month, up 21.8 percent from the same period last year, the Ministry of Commerce, Industry and Energy said yesterday.

    The growth rate is remarkable, compared with the previous month, which only saw a 2.6 percent increase in foreign direct investment (FDI).

    Officials attributed the high growth in FDI last month to various restructuring efforts of companies.

    The officials said that the increase in FDI in August was particularly noticeable in the manufacturing sector, up 35.1 percent from last August.

    According to the ministry, the total FDI in the first eight months of this year reached $9.368 billion, up 20.5 percent from last year.

    The number of projects involving FDI also increased from 2,102 last year to 2,810 this year including 341 made last month.

    By region, investments from Japan increased sharply by 133 percent to total $1.36 billion, while investments from the United States and the European Union fell 26 percent and 54 percent, respectively.

    Investments from the countries such as the Cayman Islands, Virgin Island and Bermuda increased by as much as 181 percent in a strategy to avoid taxes.

    The FDI in the manufacturing sector totaled $4.827 billion, up 35.1 percent. Specifically, electric and electronic fields drew $1.482 billion in investments; the machine field attracted $1.43 billion; and the metal field got $690 million.

    FDI in the form of acquisition of newly issued stock, either through incorporation of new enterprises or participation in equity increases of existing firms, increased 46.4 percent.

    On the other hand, FDI in the form of acquisition of outstanding stock or offering of long-term loans fell 72 percent.

    Small-scaled investments below $5 million increased 152 percent. (SHS)