Economic Contribution of FDI
Foreign-invested companies are an important part of the Korean economy
playing pivotal roles in total national sales, total exports, R&D and employment.
Foreign-invested companies are an important pillar of the national economy
As of 2016, total sales generated by foreign-invested companies in Korea stood at around KRW 441 billion, representing 12% of total national sales. Exports from foreign firms amounted to USD 100 billion, making up 20.2% of Korea's total exports. In addition, foreign-invested companies accounted for 5.7% of employment and 6% of R&D in Korea, making great contributions to the Korean economy.
Economic contribution of foreign-invested companies (2014)
- Exports 18%
- Sales 13.4%
- R&D 6.2%
- Employment 6%
Quantitative and qualitative contribution to the economy
In the process of forging cooperative relationships with Korean partners, foreign-invested companies not only boost productivity of domestic firms by transferring sophisticated management techniques and advanced technology but enhance industrial structure by spreading healthy competition across all industry sectors. Foreign investment also strengthens competitiveness of Korean companies in the global market by helping Korean partners that possess technology but lack the financial capital to expand into new markets. Foreign and domestic companies can also complement each other’s weaknesses in the greater value chain.
Cooperation between foreign and domestic companies