Korea’s Top 30 Business Groups to Spend 122 Trillion Won in Investment in 2016

Korea’s top 30 business groups plan to invest a total of 122.7 trillion won (US$100.99 billion) in their businesses this year, though most are pessimistic about their growth. The figure is up 5.2 percent from 116.6 trillion won (US$95.97 billion) in 2015.

The Federation of Korean Industries (FKI) announced the 30 groups’ investment plan at the major investment companies’ meeting held at Lotte Hotel in Sogong-dong, Seoul, on March 9, presided over by Joo Hyung-hwan, the minister of Trade, Industry and Energy.

Out of 122.7 trillion won (US$100.99 billion) of gross investment, 90.9 trillion won (US$74.81 billion) will go to facilities, pumped up by 7.1 percent year on year. The top 30 groups are expected to spend 31.8 trillion won (US$26.17 billion) on research and development, up 0.1 percent from a year earlier. The FKI said, “Despite the weak economic situation at home and abroad, major enterprises will make bold facility investments in such fields as semiconductors, organic light-emitting diodes (OLED), logistics and energy, and .focus on R&D investments to develop their new growth engines.”

By group, Samsung Group will invest a total of 15.6 trillion won (US$12.84 billion) to build a semiconductor facility in Pyeongtaek, Gyeonggi, by 2018. Hyundai Motor Group will spend 13.4 trillion won (US$11.03 billion) to develop the next-generation environmentally friendly and smart cars by 2018. SK Group will invest 5.4 trillion won in SK Hynix’s semiconductor facilities and 1.3 trillion won (US$1.07 billion) in SK Telecom’s networks this year alone. LG Group will also spend 14 trillion won (US$11.52 billion) to expand its OLED manufacturing facilities and construct “LG Science Park” in Magok by 2020.

Out of the top 30, 18 groups will increase the investment this year, three groups will make about the same amount of investments with last year and nine groups will decrease the investment.