Only One Major Company Returned to Korea in 6 Years... "Support Should Increase Considering Employment Effects"

National Assembly Budget Office Publishes 'Key Policy Analysis on Domestic Returnee Companies'

Minister Lee Jae-gap of the Ministry of Employment and Labor and Chairman Son Kyung-sik of the Korea Employers Federation are attending the '30 Major Companies CHO Meeting' held on the 25th at the Koreana Hotel in Jung-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Jang Sehee] It has been revealed that only one large corporation has returned to South Korea in the past six years. In light of the positive impact of expanding large corporations' return to the domestic market, there have been calls to consider policy support to promote the return of large corporations to South Korea.

According to the 'Analysis of Major Policies Related to Domestic Return Companies' published by the National Assembly Budget Office on the 22nd, the number of companies returning to South Korea from 2014 to 2020 was 84. Small and medium-sized enterprises (SMEs) accounted for the largest number with 72, followed by mid-sized companies with 11, and large corporations with only one.

The Budget Office argued that policies to activate the return of large corporations to the domestic market are necessary, considering the positive effects such as joint return of companies. They further explained, "For large corporations, the average investment amount accounts for 72.5%, which is 2.9 times larger than that of SMEs."

The Budget Office insists that support measures for the return of large corporations to South Korea need to be redesigned. They stated, "In South Korea, domestic return policies have been established and implemented mainly for SMEs and mid-sized companies. For large corporations, support items such as location subsidies, employment creation incentives, foreign workers under the E-9 visa (non-professional employment), and restructuring consulting are excluded from the support targets."

Finally, the Budget Office emphasized that while prioritizing fairness with support for SMEs and mid-sized companies, support benefits should be adjusted comprehensively considering employment inducement effects and other factors.

Meanwhile, South Korea provides corporate tax reductions of 50-100% for up to seven years to large, mid-sized, and small companies returning to regions outside the Seoul metropolitan area, depending on the type of U-turn company. Additionally, tariffs incurred when importing new or used capital goods for large, mid-sized, and small companies are also reduced by 50-100%.

This content was produced with the assistance of AI translation services.