Capital · Asia-Pacific

S. Korea’s FDI Arrivals Hit Record $14.8 Billion in First Nine Months

Credited to Business Korea · businesskorea.co.kr · Just now

Actual Investment Surges 30.6% as U.S. Capital Flows Into Semiconductors and AI, Despite Weaker New Commitments

Foreign direct investment (FDI) actually invested in South Korea reached a record high in the first nine months of this year, driven by strong inflows into advanced industries such as semiconductor materials, parts and equipment and artificial intelligence (AI) data centers. The increase underscores continued foreign investor interest in South Korea’s growth industries.

According to the Ministry of Trade, Industry and Energy’s “Trends in Foreign Direct Investment for Q3 2026,” released on Oct. 7, cumulative FDI arrivals through September totaled $14.87 billion, up 30.6% from the same period last year and the highest level ever recorded for the first three quarters of a year. FDI declarations, which represent newly announced investment commitments, rose 10.8% to $22.9 billion, ranking third-highest for the same period.

By investment type, greenfield investment declarations for new factories and capacity expansions rose 4.0% to $18.52 billion. The increase marked a turnaround from the 19.8% decline recorded in the first quarter. Merger and acquisition (M&A) investment declarations also posted strong growth, rising 53.1% to $4.38 billion.

By sector, services led overall investment growth with $14.21 billion in declared investment. Finance and insurance rose 29.8%, while real estate investment increased 72.6%. Investment in information and communications, which includes data centers, also grew 35.8%. Investment in electricity, gas and water, which includes clean energy projects, surged 279.5%.

Manufacturing investment declarations, by contrast, fell 34.5% year on year to $5.72 billion, mainly due to declines in chemicals and electrical and electronics investment, which fell 28.1% and 38.5%, respectively. On an arrivals basis, however — reflecting capital actually invested — manufacturing FDI reached $6.25 billion, up 110.6% from a year earlier, highlighting a sharp divergence between new investment commitments and actual capital inflows.

The United States was the largest source of growth among major investing countries. U.S. investment declarations reached $6.69 billion, up 35.1% from a year earlier, reflecting increased investment in key growth sectors such as semiconductor materials, parts and equipment and data centers. Investment from the European Union fell 3.9%, while declarations from Japan and China dropped 47.9% and 39.7%, respectively.

In terms of actual FDI arrivals, however, the EU saw a sharp increase, with inflows surging 93.7% to $4.84 billion. Japan also recorded a 63.0% increase in actual investment, despite the decline in newly announced commitments. U.S. arrivals remained broadly unchanged at $3 billion, while Chinese investment arrivals fell 41.5%, extending the decline seen in new investment declarations.

The Ministry of Trade, Industry and Energy plans to expand opportunities to attract foreign investment, focusing on three major projects in semiconductors and AI. It will strengthen domestic and international investor relations activities, including the Invest Korea Summit and overseas investment attraction caravans, while focusing on removing investment bottlenecks to facilitate both new investments and the execution and expansion of previously announced projects.

CapitalAsia-Pacific

Blackstone-backed AirTrunk to invest $1 billion in Japan data centre campus

Credited to Investing.com · investing.com5h ago

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Capital · Asia-Pacific

South Korea Tops East Asia Crypto Market

Credited to Business Korea · businesskorea.co.kr · 16h ago

South Korea’s digital asset market reached $449.1 billion over the past year, the largest in East Asia, surpassing China and Japan, according to a new analysis.

Analysis results showed that the domestic digital asset economy scale reached $450 billion over the past year, surpassing China and Japan to become the largest in East Asia. In particular, artificial intelligence (AI)-related digital assets accounted for about 18% of total Korean won trading.

According to the East Asia Crypto Adoption Report released by blockchain data platform Chainalysis on Oct. 6, the scale of South Korea’s digital asset economy from July last year to June this year was $449.1 billion, increasing by 12.3% compared to the same period last year. This is the largest scale in East Asia, exceeding Japan, Hong Kong, China, and Taiwan. Digital asset activity through domestic exchanges also increased by 16.3% during the same period.

Along with this, as of June this year, the share of AI-related digital assets in Korean won digital asset trading was the highest among major themes. It also exceeded the trading share of payment tokens such as XRP.

Interest in AI-related assets stood out even when compared to other currency zones. The share of AI-related assets in Korean won trading reached 19.5 times that of Japanese yen trading. The share of AI-related assets in Brazilian real, British pound, and euro trading also fell below that of Korean won trading.

The tokens driving the trading changed every year. While Virtual Protocol and Kaito were the center last year, the weight shifted to Worldcoin and Sahara AI this year. Trading volume by AI-related asset was the highest for Worldcoin at $7.41 billion, followed by Sahara AI at $3.2 billion, Virtual Protocol at $2.7 billion, Bio Protocol at $2 billion, and Near Protocol at $1.7 billion.

Chainalysis diagnosed that domestic individual investors showed a tendency to actively trade by quickly changing their preferred AI-related assets compared to other markets.

Expansion of corporate participation and taxation were cited as future variables for the Korean market. The explanation is that although domestic banks and securities firms are forming dedicated digital asset organizations and conducting pilot projects for stablecoins, tokenization, and custody, corporate participation for investment purposes has not yet begun in earnest. Chainalysis viewed that the market entry of corporations and the taxation on digital asset income scheduled to be implemented next year could change the participation patterns of individual and institutional investors.

Kwon Jun-hyuk, Country Manager of Chainalysis Korea, said, “Korea is a market with active participation from individual investors, where high interest and rapid preference changes for AI-related digital assets were clearly evident,” and added, “As the market participation of corporations and institutions expands in the future, the domestic market is expected to become even more diverse, so Chainalysis will continue to contribute to creating a safer and more transparent market environment based on reliable blockchain data and analysis.”

Meanwhile, Chainalysis recently stated through a report that the scale of domestic digital asset activities potentially subject to taxation reaches about 15 trillion won (about $11.2 billion). This is about 144.05% of the government’s fiscal deficit of $7.5 billion last year.