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Fresh FDI pledges to S. Korea grow 12.5 pct in H1

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(Globalpost/GlobalPost)

SEJONG, July 15 (Yonhap) -- The amount of foreign direct investment (FDI) pledged to South Korea grew significantly from a year earlier in the first half though the amount of FDI actually arriving here dropped, the government said Monday, apparently due to political risks created by North Korea.

The amount of FDI freshly pledged to the country in the first six months of the year came to US$8 billion, up 12.5 percent from the same period last year, according to the Ministry of Trade, Industry and Energy.

The ministry attributed the growth to a large increase in new FDI pledges from the United States and the European Union.

In the first half, new FDI pledges from the United States doubled from a year earlier to $2.52 billion with those from EU countries spiking 77.3 percent to $2.48 billion.

New FDI pledges from Japan, on the other hand, plunged 48.6 percent on-year to $1.36 billion though Japan's total overseas investment shrank only by 1.3 percent in the January-June period, according to the ministry.

Despite a large increase in new FDI pledges, the amount actually arriving here dropped 9.3 percent on-year to $4.41 billion.

"New FDI, in terms of the amount arriving here, jumped significantly in the second quarter as geopolitical risks dwindled with additional uncertainties stemming from the country's economic policies also removed," the ministry said in a press release.

The relations between the divided Koreas quickly worsened following the North's launch of a long-range missile in December and its third nuclear test in February.

In the first quarter, the amount of FDI arriving here came to $1.47 billion. The amount doubled to $2.94 billion in the second quarter.

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