While Korea’s outward direct investment (ODI, domestic → overseas) has increased sharply since 2000, foreign direct investment (FDI, overseas → domestic) has only slightly increased, leading to a large net investment outflow.
According to the Korea Employers Federation (KEMC) report, “Recent foreign direct investment and foreign direct investment in Korea” report, foreign direct investment increased by 2,465.7% from 2000 to 2021, but domestic direct investment by foreigners increased by 501.9%, resulting in a net investment outflow. said that it is worth $310.5 billion (regarding 407.1 trillion won).
Comparing the growth rate over the past 20 years with the growth rate of gross domestic product (GDP) over the same period, Korea’s overseas direct investment growth rate (2,465.7%) was 11.6 times higher than the GDP growth rate (212%), the highest compared to the G7 countries. I did.
On the other hand, the growth rate of domestic direct investment in Korea (501.9%) was 2.4 times the GDP growth rate, lower than the UK (5.5 times), France (3.7 times), Italy (3.3 times), and the United States (3.1 times).
In order to compare the scale of investment outflows versus investment inflows in each country, an analysis of ‘foreign direct investment ratio relative to domestic investment’ showed that in Korea, this ratio was very low in 2000 (0.49 times), but in 2021 (2.10 times), this ratio is higher than that of Japan. (7.72 times), it was higher than that of the G7 6 countries.
The Korea Economic Federation analyzed that the rapid increase in overseas direct investment in Korea was because the narrow domestic market, excessive market regulation, and weak tax competitiveness had a negative impact on domestic investment decisions.
[사진 출처 : 연합뉴스 / 경총 제공]
