Korean firms investing more abroad than ever
JoongAng Daily Korea | Jung Ha-won
KOREA
Korean companies' overseas investment rose to record levels last year, as the nation's major manufacturers built more plants in foreign countries while local refineries developed more oilfields abroad.
According to the Finance Ministry, foreign direct investment by Korean firms last year amounted to $9 billion, up 12.2 percent from a year earlier. Oil-related companies, such as SK Corp. and state-run Korea National Oil Corp., drastically expanded their development projects abroad, especially in Latin America, as they sought to secure more stable sources of oil amid skyrocketing crude oil prices worldwide.
Korea National Oil Corp. invested $62 million in oilfield development projects in Peru, while SK Corp., Korea's largest oil refiner, spent $408 million to develop oilfields in Bermuda through a joint consortium.
Although investment in China decreased 4.9 percent, and investment in manufacturing plunged 14.8 percent, this was in comparison with an unusually buoyant 2004. In that year, Hynix Semiconductors Inc., the world's second-largest memory chipmaker, announced plans to spend $300 million to build production facilities in China, which are scheduled to begin mass production this year.
"The investments in Latin America were largely boosted by projects to develop oil and natural gas fields, and companies spent significantly more money to build factories both in North America and Latin America in an effort to expand market share there," the Finance Ministry said in a statement.
Last year, Hyundai Motor Co. opened a production facility in Alabama, the company's first car factory in the United States. The Alabama plant is expected to account for fully one-third of Hyundai's global car production this year. Hyundai Motor is also building its second factory in China, where the group aims to build 1 million vehicles by 2010, or one fifth of its worldwide output.
Investment in African nations and Oceania grew by a whopping 141 percent, as Korea National Oil Corp. spent more money for development projects of the Elephant oilfield in Libya.
iht.com |
