ID :
190240
Wed, 06/22/2011 - 02:12
Auther :
Shortlink :
https://oananews.org//node/190240
The shortlink copeid
Hostile investment policy
(Yonhap) - Despite Seoul???s business-friendly sloganeering, foreign direct investment (FDI) has fallen for three straight years under the Lee Myung-bak administration.
Prime Minister Kim Hwang-sik???s meeting Tuesday with foreign investors was a fresh occasion to review the investment climate here.
The nation has an image problem. A long delay in the exit of Lone Star from KEB has puzzled many potential investors. They have a generic image of Korea where investment funds may be blocked.
This negative perception has serious repercussions on foreign investment here. KOTRA may say that the country is an ideal place for foreign investment as the economy is on a strong growth trajectory on the back of its technological prowess.
This marketing strategy backfires as international investors are unsure about the possibility of taking their money out of Korea at any time.
Seoul officials may say the Lone Star case is an isolated one which is pending in court. But foreign investors discount this argument.
International investors also get annoyed when about 10 financial regulators are either being investigated or jailed for taking bribes.
They also take a wait-and-see attitude as political theory prevails in the financial market. They have second thoughts on investing in local banks as CEOs are political appointees.
The nation has yet to clear the lingering foreign skepticism over aggressive labor movements. The ongoing labor dispute at SC First Bank has gained a high profile among international businessmen. The planned introduction of multiple unions in a company is also a headache for potential foreign investors.
President Lee???s commitment to lowering corporate taxes faces an obstacle at the National Assembly. This zigzag policy has also disappointed international investors. Lawmakers??? lack of foresight in gauging the implication of their legislation is affecting international investors.
Under this negative climate, it is no coincidence that new FDI fell to $5.4 billion last year, down from $8.4 billion in 2008 and $6.7 billion in 2009.
Worrisome is an exodus of Korean manufacturers to offshore locations. Korea???s outbound direct investment amounted to $23 billion last year. When local firms are moving out of the country, it may be naive to expect an influx of FDI.
Predictability and transparency are the keys to encouraging investment in Korea both by local and international investors and businessmen.
Now is a soul-searching time for Korea to review the investment climate.
Prime Minister Kim Hwang-sik???s meeting Tuesday with foreign investors was a fresh occasion to review the investment climate here.
The nation has an image problem. A long delay in the exit of Lone Star from KEB has puzzled many potential investors. They have a generic image of Korea where investment funds may be blocked.
This negative perception has serious repercussions on foreign investment here. KOTRA may say that the country is an ideal place for foreign investment as the economy is on a strong growth trajectory on the back of its technological prowess.
This marketing strategy backfires as international investors are unsure about the possibility of taking their money out of Korea at any time.
Seoul officials may say the Lone Star case is an isolated one which is pending in court. But foreign investors discount this argument.
International investors also get annoyed when about 10 financial regulators are either being investigated or jailed for taking bribes.
They also take a wait-and-see attitude as political theory prevails in the financial market. They have second thoughts on investing in local banks as CEOs are political appointees.
The nation has yet to clear the lingering foreign skepticism over aggressive labor movements. The ongoing labor dispute at SC First Bank has gained a high profile among international businessmen. The planned introduction of multiple unions in a company is also a headache for potential foreign investors.
President Lee???s commitment to lowering corporate taxes faces an obstacle at the National Assembly. This zigzag policy has also disappointed international investors. Lawmakers??? lack of foresight in gauging the implication of their legislation is affecting international investors.
Under this negative climate, it is no coincidence that new FDI fell to $5.4 billion last year, down from $8.4 billion in 2008 and $6.7 billion in 2009.
Worrisome is an exodus of Korean manufacturers to offshore locations. Korea???s outbound direct investment amounted to $23 billion last year. When local firms are moving out of the country, it may be naive to expect an influx of FDI.
Predictability and transparency are the keys to encouraging investment in Korea both by local and international investors and businessmen.
Now is a soul-searching time for Korea to review the investment climate.
