Foreign direct investment commitments to South Korea hit a fifth consecutive record last year, rising 4.3 percent to $36 billion, while actual inflows jumped 16.3 percent to $17.95 billion, the Ministry of Trade, Industry and Resources said Wednesday. The government credited the surge to restored investor confidence after the launch of a new administration in June, which reduced political uncertainty and stabilized expectations for the economy. "Along with the new administration's push on AI policy, the government's investment promotion efforts during the APEC leaders' summit in Gyeongju also supported the growth in foreign investment," the ministry said. Amid domestic political uncertainty following the martial law crisis and the impeachment of former president Yoon Suk Yeol, as well as tariff pressures from the US, inflows struggled through the January-September period. Investment rebounded in the fourth quarter with the presidential election in June and the 2025 Asia-Pacific Economic Cooperation leaders' summit in October. By type, greenfield investment, referring to new or expanded production facilities, rose 7.1 percent from a year earlier to $28.59 billion, marking an all-time high. The increase followed major investment filings, including a data center project by Amazon Web Services, the world's largest cloud services provider, as well as semiconductor packaging investments by US-based Amkor Technology and process gas facilities by France's Air Liquide. While merger and acquisitions investment came to $7.46 billion, down 5.1 percent from a year earlier, the decline narrowed sharply from a 54 percent slump recorded in the third quarter last year, the ministry said. By sector, manufacturing investment rose 8.8 percent to $15.77 billion. Investment surged in chemicals, which reached $5.81 billion, up 99.5 percent, and metals, which jumped 272.2 percent to $2.64 billion. The Trade Ministry said investment was concentrated in core materials used in advanced industries, reflecting efforts to strengthen supply chains amid external uncertainties. Investment in electrical and electronics declined 31.6 percent to $3.6 billion, which the ministry attributed to a base effect following large-scale investment by major chipmakers such as Samsung Electronics and SK hynix last year. Service sector investment increased 6.8 percent to $19.05 billion, supported by growing investment in online platforms and AI data centers. Inflows rose sharply in distribution, which jumped 71 percent to $2.93 billion, and information and communications, which increased 9.2 percent to $2.34 billion. By source country, investment from the US surged 86.6 percent to $9.77 billion, while investment from the EU rose 35.7 percent to $6.92 billion. In contrast, investment from Japan fell 28.1 percent to $4.4 billion and inflows from China declined 38 percent to $3.59 billion. "Inflows linked to advanced industries such as artificial intelligence, semiconductors and biotechnology expanded last year and are expected to support Korea's economic and industrial growth," a trade ministry official said. The ministry said it will expand incentives to attract foreign investment and actively overhaul unreasonable regulations affecting foreign-invested firms, aiming to sustain momentum from the record inflows. FDI calculates long-term investment in which foreign investors take equity stakes in, or participate in the management of, companies in another country. (ICE SEOUL)

Fonte notizia: The Korea Herald