- FDI pledged to Korea amount to $4.7 billion in Q1 2021-04-05
The Ministry of Trade, Industry and Energy announced on April 5 that foreign direct investments (FDIs) pledged to Korea in the first quarter of this year jumped 44.7 percent year-on-year to USD 4.7 billion. The FDIs that actually arrived in Korea over the same period also went up 42.9 percent to $4.3 billion.
Despite difficult external circumstances amid COVID-19, FDI arrivals hit the record high quarterly value for the first quarter in history. Investment that was delayed due to the virus outbreak last year has resumed in the first quarter led by strong merger and acquisition (M&A) investments.
In particular, FDI to Green New Deal-related projects, new industries, and high-tech materials, parts and equipment sectors expanded.
By country, FDI pledged from the U.S. to Korea contracted 39.4 percent to $225 million and that actually arrived also shrank 87.7 percent to $25 million.
Investments pledged from China and other regions (including Hong Kong, Singapore, Taiwan, and Malaysia) went down 41.2 percent to $859 million and those actually arrived dropped 51.0 percent to $652 million.
Meanwhile, new FDI commitments from the European Union (EU) spiked 316.8 percent to $3.1 billion and those arrived soared 314.6 percent to $2.4 billion.
FDI pledges from Japan to Korea advanced 91.4 percent to $242 million and those actually arrived gained 133.7 percent to $204 million.
By industry, the manufacturing sector saw a pledged investment of $446 million in the first quarter, down 28.0 percent from the same period last year. The FDI arrived lost 70.6 percent to $266 million. Industries that experienced growth were machinery equipment and precision medical devices as well as transportation machinery. Those that experienced declines were electrical and electronics and chemical engineering.
For the service sector, FDI pledges amounted to $4.2 billion, up 57.0 percent. The FDI arrived recorded $4.0 billion, up 92.9 percent. While investments in information and communications technology and wholesale and retail expanded, those in finance and insurance as well as R&D and technology contracted.
By type, greenfield investments pledged to Korea dipped 13.1 percent to $1.6 billion, and that arrived went down 16.6 percent to $1.0 billion.
For M&A investments, FDI pledged was $3.1 billion, which is 122.0 percent more compared to the first quarter of last year. M&A investment that arrived totaled $3.3 billion, up 84.0 percent.