Asian direct investment in Seoul surges 65%

Direct investment from Asian countries in Seoul surged by over 65 percent last year, the city’s report showed Tuesday.

According to Seoul Metropolitan Government, direct investment from Asian countries rose to about $2.6 billion last year, showing a 65.4 percent increase on-year. This accounts for 47.3 percent of the total direct investment in the capital.

While direct investment from China remained about the same at $63 million as in 2013, detour investment via Singapore and Hong Kong played a major role in the surge, officials said. High anticipation over the free trade agreement between the two countries also contributed to the hike, they added.

However, there was a decline in investment from other regions, partly due to overseas economic problems, the report said.

Direct investment from European countries plummeted to 1.3 billion, down 53.7 percent from 2013. Investment from the U.S. also fell to 1.6 billion won, dropping 8.3 percent on-year.

As a result, the overall foreign direct investment in the capital fell to about $5.5 billion, showing a 10.7 percent decrease, the report said.

A total of 59 countries made investments in Seoul, with an average of $6.5 million, it said.

Among them, the U.S. was the largest contributor with about $955 million, followed by Singapore and Japan, with $951 million and $714 million, respectively.

By industry type, 84 percent of the foreign investors flocked to the service sector, which includes the finance, insurance and distribution markets. The rest invested in manufacturing, the city said.

While the overall investment in the service sector declined by about 20 percent to $4.5 billion, the financial injection in the manufacturing business sharply grew by about 144 percent to $877 million, it added.

By Lee Hyun-jeong (rene@heraldcorp.com)