6 out of 10 Foreign-Invested Companies Plan to Increase Investment in Korea

Factors Influencing Korean Investment Decisions: Market Potential, Investment Incentives, and Skilled Workforce

Among foreign-invested companies (hereinafter referred to as foreign-invested companies) operating in Korea, 6 out of 10 expressed their intention to increase investment in Korea. Foreign-invested companies refer to companies in which foreigners invest more than 50 million KRW and hold at least 10% of shares with decision-making authority.

According to the results of the "Survey on Investment Decision Factors of Foreign-Invested Companies" conducted recently by the Korea Chamber of Commerce and Industry in collaboration with Professor Oh Jun-seok's team at Sookmyung Women's University and KOTRA, 64.2% of foreign-invested companies surveyed (95 companies) are considering additional investment in Korea in the future.

A job seeker is consulting at the Seoul Global Company Job Fair. Photo by Mun Ho-nam munonam@

Foreign-invested companies operating in Korea had a positive perception of investment in Korea. When asked about their overall satisfaction with investment in Korea, 89.1% of respondent companies answered "satisfied," and 71.4% said they would give positive advice to companies considering entering Korea. More than half (53.8%) of the companies also responded that they have actual plans for additional investment.

Professor Oh said, "In a situation where Korea's investment momentum is weakening, the high satisfaction of foreign-invested companies with investment in Korea and their consideration of additional investment indicate that the investment environment is competitive," adding, "It is necessary to establish strategies and improve systems to attract investment more aggressively."

The factors considered when deciding on investment in Korea were market growth potential (55.1%), investment incentives (53.9%), entry into the domestic market (49.4%), and securing excellent human resources (44.9%), in that order.

The factors considered when deciding on overseas investment by Korean companies operating abroad (135 companies) differed from those of foreign-invested companies operating in Korea. Besides market growth potential, they prioritized building a global network (43.7%), low labor costs (43.0%), and research and development (R&D) innovation environment (26.7%), showing differences in investment decision factors.

Regarding government policy factors considered by foreign-invested companies when investing in Korea, the attractiveness of investment incentives (68.8%) was cited most frequently. This was followed by regulatory difficulties (64.5%) and ease of obtaining administrative and regulatory information (61.3%).

Additionally, foreign-invested companies identified the relaxation of cash support requirements (69.1%) and strengthening of tax reductions (69.1%) as the most necessary policy improvements for the investment incentive system. This was followed by strengthening financial support through funds (57.4%) and expanding site support (47.9%).

Lee Sang-heon, head of the Regulatory Innovation Team at the Korea Chamber of Commerce and Industry, said, "We should recognize changes in the global investment environment caused by supply chain restructuring and the departure of manufacturing from China as opportunities to expand investment attraction," adding, "To promote investment, it is necessary not only to improve the incentive system but also to enhance the overall investment attraction support system, including administrative infrastructure and investment support services."

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