Shortcut to Body Shortcut to main menu

Feature Stories

  • Home
  • Why KOREA
  • Feature Stories
Roundtable Discussion with Honorary Ambassadors of Foreign Investment Promotion for Korea (2)
Roundtable Discussion with Honorary Ambassadors of Foreign Investment Promotion for Korea

Invest KOREA spoke with the Honorary Ambassadors of Foreign Investment Promotion for Korea to get their insight on Korea’s investment environment and ways to boost multilateral investment cooperation.

During the second session of a two-part roundtable held via video conference, three honorary ambassadors of foreign investment promotion for Korea, appointed by the Ministry of Trade, Industry and Energy, held discussions on Korea’s investment environment and ways to enhance multilateral investment cooperation.
The Honorary Ambassadors of Foreign Investment Promotion for Korea
The Honorary Ambassadors of Foreign Investment Promotion for Korea
Jean-Marie Hurtiger Jean-Marie Hurtiger
Senior Executive of ERG-Europe, Former CEO of Renault Samsung Motors, Former President of the European Chamber of Commerce in Korea
James Choi James Choi
Senior Advisor of Prostar Capital, Managing Director of J2 Advisory, Former Ambassador of Australia to South Korea, Former Chief Advisor to Minister of Foreign Affairs in Australia
Youngjae Kim, Youngjae Kim,
Senior Research Fellow (VP) at LG Electronics, Member of the Advisory Board on Robotics Engineering at the Consumer Technology Association (CTA), Former Senior System Engineer at Apple Inc.
On May 17, three honorary ambassadors of foreign investment promotion for Korea took part in a video conference to hold active discussions on Korea’s extraordinary journey toward growth and development, as well as the country’s ongoing efforts in becoming a business hub for leading companies around the world. Last year, Korea reached another milestone, recording an all-time high in foreign direct investment (FDI). Each possessing a unique background and career experience, the ambassadors offered valuable insight into what it is that makes Korea a great investment destination, as well as ways the country can improve its business environment. Read on to find out more.
From your perspective, what are the factors contributing to Korea’s success in achieving the record-high figure for FDI in 2023, and what are the country’s strengths that are attractive to global investors and companies?

Hurtiger: First of all, Korea’s high education levels, great infrastructure, talented workforce, and the high number of tech companies create a synergistic environment for innovation and growth. On top of such internal factors, there are external factors that contribute to Korea’s FDI success as well—for instance, we all know that the Chinese economy was changing over the past few years, making it more difficult for foreign investors to do business there. I think this allowed for more room for investors to consider moving away from China and reshore in other Asian countries, and that’s where Korea really shines because of its potential and opportunities for growth, especially in technology.
When I look at the relationship between France and Korea, what I see is that most of the large French companies, or at least the ones who are interested, have already invested in Korea and have continued to invest over time. Now, one change I’ve noticed is that we (France) have a lot of small- and medium-sized tech companies, and for them, Korea is a great partner because of the country’s advancement in technology, and because they can build a complementary relationship with the local companies here.
I also think it’s beneficial to have a good foothold in Asia, and Korea offers a safer setting for smaller companies since it is less costly in terms of initial investment. For instance, I have seen many examples of companies who have been trying to go to both Japan and Korea for instance, and in the end, they can work in both countries, but things usually go a lot faster in Korea, where foreign companies are relatively well accepted and accepted faster.

Choi: From where I sit, supply chains are being upended because of the geopolitical contest that the US and China are in, and the war that's really breaking out. It's forcing companies to de-risk from China. And so, you can see that the phenomena of ally shoring is strong. Korea, as an industrial powerhouse, is attracting foreign investment for precisely that reason.
The second reason is because Korea is doing things that lead to the decarbonization of technology. It's battery technology, its EVs, it's critical minerals, and it’s semiconductors on top of the whole geopolitical contest, meaning that all of this creates a very attractive destination for investment.
I would also add that generally speaking, Korea is becoming much more popular in the eyes of international visitors simply because the country’s brand image is so much stronger now than it has ever been. So, the awareness of Korean companies’ strengths but also its strengths in specific niche areas in terms of industrial capacity are attracting interest. Against this backdrop, I'm not surprised that more investors are looking at the Korean market as a destination for their investment.

With the emergence UN Global Compact (UNGC) and RE100, Korean companies are increasingly expected to align with these global initiatives as prominent players on the global stage. What are some strategies that Korean companies can adopt to effectively respond to such initiatives?

Kim: As an engineer, the UNGC and the RE100 are not just simple environmental campaigns anymore. I think we are honestly already too late, and people are starting to realize that this is very important to their lives. I think it's important to link this kind of campaign to financial value, because otherwise, people will get into a dilemma, since a company basically tries to maximize its profit.
We’re seeing Korea actually understanding this and adding financial value to initiatives like the ones mentioned. And now, Korean companies are automatically more eager to follow the policies and campaigns because it directly affects their profit models.

Choi: I agree. From what I see, Korean companies are already starting to shift, at least in terms of their strategic thinking on what they need to do. The first thing that obviously Korean companies will want to do is to try to source green energy from Korea. But because of Korea's limited renewable capacity, Korean companies are sculping out the renewable opportunities here in Australia, how they can source green electrons for their industrial processes.
Going forward, I foresee Korean companies sourcing green molecules made from renewable energy elsewhere that will feed into Korea's future hydrogen industry. This definitely is a big shift that requires huge investment. Ultimately, as we are seeing things unfold, it seems like Korean companies are preparing for a carbon price to be placed on operations as we're also seeing with the European Carbon Border Adjustment Mechanism (CBAM) being implemented by 2026.

Hurtiger: To participate in international initiatives like the Global Compact and the RE100 is important. It's also very important to let this be known and actively communicate what Korea is doing within those initiatives.
And it's true that Korea efforts to decarbonize are underway, but from what I understand, the plan is to actually to be able to import the green molecules from, let's say for instance, oil producing countries such as the Middle East—either hydrogen or ammonia. To feed the energy industry in order to do that, you have to do a lot of development, such as converting ammonia into hydrogen or using ammonia directly. So, it's a whole new field of technical development where Korea will be uniquely placed and will probably come up with unique solutions of its own. Companies will have to adapt and they should be probably more outspoken about their initiatives and what they're doing.
In the nuclear industry, Korea is now well positioned, because it can produce efficient and rather cheap nuclear energy, which poses another greater opportunity.

To continue attracting FDI and continue on the country’s success thus far, what roles should the Korean government and investment promotion agencies (IPAs) like Invest KOREA play?

Kim: Before this meeting, I actually had the chance to watch some of the contents on KOTRA’s YouTube channel, and found that they were really great quality contents. But, I was surprised to see that the number of views were not as high as the quality of the contents. So, in terms of an advertisement and PR perspective, I think it would be helpful for government bodies and agencies to utilize social media, because it definitely is more powerful than we think.

Hurtiger: In comparison to other countries, I think that overall, the current system of incentives that are already available for companies who invest in Korea are already pretty good. The system is fairly straightforward and easy to understand. So, I don’t think there’s much more to do in that field and is not where we can improve.
I think the difficulty lies in finding the good companies abroad and the companies that have potential in Korea, or Korean companies that have potential in Europe. I suggest going a step further in preparing trade shows or investment events to offer more opportunities for discussions and exchanges.

Choi: Over the longer term, in terms of Australia and Korea, I think the Ministry of Trade, Industry and Energy in Korea, but also Invest KOREA and KOTRA needs to begin focus on the themes that are relevant through the Australia Korea Partnership, and look at Australia's strengths in the upstream side of critical minerals and how it fits into Korea's battery industry.
I think there are many more opportunities that will occur especially as Australia wants to go downstream in processing, but also, as Korea wants to secure the upstream security supply chain, there needs to be much more policy dialogue as well as trade and investment discussions on how we can complement each other in these industries. I also think it’d be beneficial for the Korean government to do more strategically to signal to investors that it wants investment in the critically important area of renewable energy.

By Grace Park
Investment PR Team, Invest KOREA
Korea Trade-Investment Promotion Agency (KOTRA)

Meta information