The Korea Trade-Investment Promotion Agency (KOTRA) announced on June 11 that South Korean companies reported a total foreign direct investment (FDI) in Vietnam of US$50.555 billion, which was divided into 5,773 cases of investment, until the end of last year for South Korea to become the largest investor in Vietnam.
The amount is equivalent to approximately 17.2% of the total FDI in Vietnam that was made between 1988 and last year. South Korea was followed by Japan (US$42.434 billion) and Singapore (US$39.255 billion).
In 2016 alone, South Korea’s FDI in Vietnam totaled US$6,895.8 million, 30.8% of the total FDI in the country during the period. The manufacturing sector accounted for 82.3% of the investment from South Korea to Vietnam, led by large-scale investments from companies working with Samsung Electronics and LG Electronics, while science, technology and the like, construction, and banking and finance represented US$317 million, US$311.3 million, and US$219.8 million, respectively.
As reasons for the increase in the FDI from South Korean companies to Vietnam, the KOTRA mentioned its geographical proximity to China, well-educated and highly-skilled yet inexpensive labor force, solid market growth potential based on a rapid growth in income and economy, and business-friendly government policy.