This study analyzes the establishment of foreign direct investment policy.
In order to respond to intensified global competition, it is necessary for Korea to improve economic efficiency and to strengthen international competitiveness. However, the technological advancement, and complexation and convergence of technology itself requires greater technology investment, and overseas sales and expansion of trading network costs are increasing as well. To respond to increased operation costs related to overseas operations, and to prepare for international competition, foreign direct investment is crucial. Foreign direct investment improves local competitiveness, the competitiveness of the local economy improves as more global companies are attracted. As a result, improving the investment environment of a local economy is a tool to attract international companies, and this is the way to expand competitiveness and the basis for growth of a local economy.
The Korean government developed their foreign investment policy for over 30 years. However, they failed to reexamine the basic direction of foreign investment policy to meet the changing international economic environment and competition. Therefore, it is necessary to develop efficient investment policy in order to maximize investment results. Policy related to foreign direct investment should transform Korea from a labor-intensive production base to a technology-intensive base. In addition, it should aim to advance technology within high technology fields, and the government should to develop itself into a bridgehead for economically developed countries in northeast Asia.
To achieve these policy objectives, domestic investment systems or practices should be advanced to the global level, and improvement in the investment environment, such as establishing social indirect capital, is required. Furthermore, the government should introduce strategic alliances among companies, establish fair competition systems between locals and foreigners, and promote active investment attracting activities. Also, the government should enhance the Korean economy’s status so as to be favorable to direct investment, avoid excessive competition, and establish long-term policy objectives for foreign investment.
외국인직접투자와 투자정책(The foreign direct investment and the investment policy)
|Series Title; No||연구보고서 / 94-06|
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Economy < Direct Investment|
|Holding||KDI; KDI School|