Despite the present situation of investors’ market sentiment being generally low due to COVID-19, Seoul’s foreign direct investment (FDI) recorded the highest figure in 2020, having exceeded USD 10 billion for two consecutive years.
According to the UN Conference on Trade and Development (UNCTAD), global FDI for 2020 was USD 850 billion, which saw a 42% decrease compared to last year, the lowest in 15 years. In contrast, Seoul’s FDI exceeded USD 10.083 billion in 2019 and broke the record in 2020 at USD 10.199 billion.
|Seoul’s FDI (Unit: USD 1 million; based on reported amount)|
Seoul’s reported investments in 2020 amount to 49% of nationwide FDI. This means Seoul is leading the attraction of foreign capital as a global investment hub city.
The major factor of the increase of Seoul’s FDI in the last year is the rapid progress of the service industry. Investments from the finance and insurance industries increased by 132% compared to the previous year, from the Americas by 99%, and from new industries by 40% (recording USD 7.3 billion) thanks to the full-swing reorganization of the industrial structure according to the Fourth Industrial Revolution.
In particular, investment from the Americas expanded by 99% compared to the previous year and was reported to be USD 4.38 billion, which shows a remarkable increase in the investment. It is analyzed that positive factors, such as the stable investment market based on K-disinfection, extensive FTA network, and high foreign credit rating, were visualized.
The Seoul Metropolitan Government (SMG) has plans to rapidly attract investments through diversified measures, such as distributing employment subsidies of up to KRW 50 million and supporting the participation in overseas fairs for promising companies, so that promising Seoul-based start-ups can grow their scales with the expansion of Seoul’s FDI.