Foreign direct investment (FDI) pledges to South Korea advanced 7.5 percent on-year in 2023 to hit an all-time high on the back of the robust performance of the chip, battery and transportation sectors, the industry ministry said Thursday.

Asia’s No. 4 economy received US$32.7 billion worth of FDI commitments in 2023, compared with $30.4 billion tallied a year earlier, according to the Ministry of Trade, Industry and Energy.

The amount of investment that actually arrived in South Korea also set a fresh high of $18.7 billion, up 3.4 percent on-year.

“The investment will not only help South Korea expand its exports but also create quality jobs and add vitality to the local economy,” the ministry said in a statement.

By industry, the FDI pledges to the manufacturing sector fell 4.5 percent on-year to $11.9 billion due to a base effect, although those to the electronics segment, including chips, moved up 17.7 percent to $4 billion.

Those to the transportation segment also more than doubled to reach $1.76 bi
llion, the data showed.

The service industry received total FDI of $17.7 billion in 2023, up 7.3 percent on-year.

By country, the United States’ investment in South Korea came to $6.1 billion, down 29.4 percent on-year.

The ministry attributed the decrease to a base effect, with some U.S. firms making investments via other countries, including Australia and the Cayman Islands.

The combined amount of FDI pledges from China, Hong Kong and Taiwan came to $3.12 billion, up 65.6 percent on-year, led by the manufacturing and service sectors.

The investment from the European Union fell 17 percent to reach $6.22 billion in 2023, the data also showed.

Source: Yonhap News Agency