FDI pledges to S. Korea down 10.4 pct in H1

Foreign direct investment (FDI) pledges to South Korea fell 10.4 percent on-year in the first six months of this year amid economic uncertainties, data showed Friday. The country received US$15.34 billion in FDI commitments in the January-June period, down from the record of $17.1 billion a year earlier, according to the Ministry of Trade, Industry and Energy. The ministry attributed the decrease to a base effect, noting that performance was "exceptionally" high last year following President Yoon Suk Yeol's visit to the United States and Europe. "Despite challenging economic conditions, including geopolitical uncertainties and high interest rates, the first-half performance of FDI pledges remained above the five-year average of $11.7 billion," the ministry said in a statement. The ministry also noted that investments attracted by cutting-edge industries gained ground, contributing to stronger economic security and a more stable supply chain. The amount of investment that actually arrived in South Korea in the first half, meanwhile, fell 17.4 percent to $6.9 billion. By sector, the manufacturing segment attracted $8.13 billion in FDI pledges in the first half, up 6.5 percent from a year earlier. Specifically, the electronics industry, which includes semiconductors, secured $3.64 billion in FDI pledges, up 25.7 percent, while the machinery and medical precision industry more than doubled to $1.11 billion. However, the chemical industry saw its FDI pledges decline by 48.5 percent to $1.43 billion over the period. The service sector experienced a 24.3 percent decrease in FDI pledges to $6.41 billion, due to sluggish performance in the finance and retail industries, where figures fell 22.4 percent and 44.3 percent, respectively, to $3.06 billion and $760 million. The information and communication industry, however, saw its investment pledges from overseas rise 25.3 percent to $990 million, while the leisure, sports and gaming industry grew twofold to $150 million. By country, FDI pledges from China, Hong K ong and Taiwan amounted to $3.94 billion, growing twofold over the period, led by both the manufacturing and service sectors. Pledges from the United States totaled $2.61 billion, down 28.7 percent over the period due to the lackluster performance of the manufacturing industry. China and the U.S. accounted for 25.7 percent and 17 percent of the total FDI pledges to South Korea in the first half, respectively. Source: Yonhap News Agency