ΆΓ  Foreign direct investment fell sharply last month

Korea Herald 2001. 3. 8   

Foreign direct investment (FDI) reached $329 million in February, a drop of 47.5 percent over the previous year, the Ministry of Commerce, Industry and Energy said yesterday.

The number of instances of FDI, however, came to 268, up 5.9 percent from a year ago.

A ministry official explained the sharp drop in FDI as owing to the exceptional record last February when Hana Bank alone attracted $158 million in foreign investment. "The FDI record is usually low in February because there are less working days in the month," the official added.

The ministry said small-denomination investments of below $5 million accounted for 95.9 percent of the total.

Investments worth between $5 million and $10 million made up 1.5 percent of the total and those worth between $10 million and $100 million accounted for 2.6 percent.

By sector, the manufacturing industry accounted for 28 percent of total FDI, an increase of 4.9 percent over the previous year. Investments in the service industry, meanwhile, decreased by 4.9 percent to 72 percent.

The ministry said 90.6 percent of FDI, worth $298 million, came in the form of acquiring shares in newly created firms or by participating in capital increases at established firms. Acquiring existing stocks took up 4.9 percent and long-term loans 4.5 percent.

By region, the U.S., EU and Japan maintained their positions as largest investors.

Investments in the first two months of the year combined, meanwhile, amounted to $3.76 billion, an increase of 111.8 percent over the previous year. However, the number of investments dropped by 9.1 percent to 508.