Govt. Lowers Thresholds for Real Estate Investment Immigration
Starting on the first of this month, the thresholds for foreign investors’ real estate investment immigration will be cut in half, to KRW 500-700 million. The investment immigration system grants permanent residency to foreigners who invest in domestic real estate. In addition, villas within golf courses in the Songdo and Cheongna Districts, located in the Incheon Free Economic Zone (IFEZ), will be included in the investment destinations that are affected by the system. Experts in the construction industry say this decision will inject vigor into the real estate market of Songdo, Incheon and Pyeongchang, Gangwon Province.
Last month, the Ministry of Justice unveiled a plan to lower the minimum amounts from KRW 1.5 billion to KRW 0.7 billion for IFEZ and from KRW 1 billion to KRW 0.5 billion for Pyeongchang. The minimum amount will remain unchanged (KRW 500 million) for Jeju Island and Yeosu, South Jeolla Province.
The Ministry of Justice has decided to apply these new thresholds temporarily for five years to avoid overheating of the real estate market. The outcomes will be analyzed then and the ministry will decide whether to extend the application of the new standards.
Global Parts Companies Record Strong Performance in Korea
As Korea becomes a leader of the global manufacturing sector, global chemical and parts companies have shown strong performance in the country thanks to the demand of domestic businesses.
The sales revenue of BASF, the world’s largest chemical company, reached KRW 2.52 trillion last year. The figure had plummeted to KRW 1.98 trillion in 2011 from KRW 2.90 trillion in 2010.
The revenue of 3M Korea increased to KRW 1.35 trillion in 2012 from KRW 1.34 trillion in 2011, after a slight drop from KRW 1.48 trillion in 2010. Operating profits soared from KRW 119.6 billion in 2011 to KRW 172.3 billion in 2012.
As for Dow Corning, a company that deals mainly with silicones, sales revenue increased by 9 percent from KRW 451.2 billion in 2011 to KRW 492.9 billion in 2012. Operating profits showed sharper growth of 14 percent from KRW 78.5 billion to KRW 89.1 billion during the same period.
For Toray Advanced Materials, sales rose from KRW 1.28 trillion to KRW 1.33 trillion between 2011 and 2012 while operating profits fell slightly, from KRW 206.2 billion to KRW 190.1 billion.
Merck recorded an operating loss in 2012, but its net profit increased thanks to rising sales and falling costs. Sales jumped from KRW 100.9 billion to KRW 136.6 billion while net profit increased from KRW 2.5 billion to KRW 3.7 billion.
President Park Meets With Foreign Investors
Korean President Park Geun-hye held a luncheon last month at Cheong Wa Dae with representatives of foreign-invested companies to promote foreign investment in Korea.
A spokesman said the foreign guests highly appreciated President Park’s efforts to expand communication channels with foreign-invested companies and that the guests agreed to fully trust the Korean government and continuously invest in the country.
Pat Gaines, Chairman of the American Chamber of Commerce in Korea (AMCHAM), said that despite rising tensions between the Koreas, he had confidence in the Korean government, as it has been working closely with allies to defend peace and stability. He added that in the process of building a fair, transparent and competitive economy, Korea will see more FDI and jobs.
Amy Jackson, President of AMCHAM in Korea, said American companies will not withdraw their business from Korea. She added that AMCHAM would assure American firms of the safety of Korea’s business environment.
During MOTIE Roadshow, Schaeffler Reports Investment Plan
The Ministry of Trade, Industry & Energy (MOTIE) recently announced that Schaeffler, a German auto parts company, has announced plans to invest USD 34 million in Korea.
MOTIE and the chambers of commerce in Munich and Hamburg, Germany co-hosted a roadshow in March in those cities to promote Korea as an investment destination for German parts and materials companies. The event was aimed at attracting small but strong German parts and materials companies showcasing remarkable growth amid global economic difficulties.
During the roadshow, Schaeffler reported its plan to invest USD 34 million in Korea. Its chairman visited Gyeonggi Province last year and signed an MOU for a USD 100 million investment project.
Source : Invest Korea