Direct Investment to Other Countries Up 2.5 Times

It has been reported that direct private investment, such as foreign real estate and golf courses, has largely increased this year.

According to the Ministry of Finance and Economy and the Export-Import Bank of Korea on September 21, the direct investment scale of individuals or private businesses totaled 11 cases and $8,040,000 (approximately 9,246,000,000 won).

This value is a 56.8 percent increase compared to last year’s amount of $5,127,000 (eight cases) during the same term. This also represents 91 percent of last year’s sales, which were $8,771,000.

The U.S held the largest amount of invested capital, $4,322,000 (six cases). Following that, Japan invested $2 million (one case), Canada $1.36 million, France $308,000 (one case), and China $50,000 (one case).

Foreign real estate investment by individuals or private businesses is heading upwards every year, starting from $863,000 (three cases) in 2000, $1,587,000 (three cases) in 2001, to $5,216,000 (eight cases) in 2002.

This year’s level of private investment in entertainment, culture, and sports-related industries such as foreign golf courses or resorts from January to July has been reported as $8,859,000 (26 cases). This is a 157 percent increase compared to last year’s amount of $3,438,000 (12 cases) during the same term. In geographic terms, investments in places such as golf courses and gyms in China occupied the most, totaling $3,551,000 (10 cases).

Oh Moon-suk, the senior economist at the LG Economic Research Institute, said, “Individuals who did not find an appropriate investment destination due to factors such as low interest rates and stagnation in the domestic real estate market are turning to investment in foreign real estate,” and added, “There is a big possibility that the foreign direct investment of individuals will continue for a while.”

Yong Park parky@donga.com