Capital inflows by overseas Koreans jump in Jan-May

By Park Bo-ram
SEOUL, July 7 (Yonhap) -- Capital transfer by overseas Koreans to their home
country nearly quadrupled in the first five months of this year from a year
earlier due largely to the Korean currency's weakness and falling real estate
prices, data by the central bank showed Tuesday.
According to the Bank of Korea (BOK), inbound money by overseas Koreans stood at
US$1.41 billion in the January-May period, compared with $380 million in the same
period last year. The figure marked almost 19-fold growth, compared with two
years earlier when the corresponding readings came in at $75.2 million.
On the other hand, capital outflow by local residents fell 33 percent on-year to
$440 million during the first five months of 2009, bringing the balance of
capital transfer to a surplus of $971 million. The capital transfer account
logged a deficit of $271.1 million in the same period last year.
Experts say a rise in capital inflows largely came as the won's weakness and
falling real estate prices gave incentives for overseas Koreans to invest in the
local property market in expectation of profit-taking when the currency and real
estate prices regain footing down the road.
"The surplus seems to have come as overseas Koreans increased their investment in
local real estate, though it needs more thorough examination," a BOK official
said.
The local currency fell 28.6 percent against the U.S. dollar in the January-May
period, compared with the same period of last year.
pbr@yna.co.kr
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