Korea invites foreign capital investmentTo develop its capital market, Korea is implementing a policy of ‘market liberalisation' to directly increase the country's access to foreign capital and investment.
Korea has already made significant progress in opening its capital market and reducing barriers to direct investment. As of late May 1998, foreign investors have been able to buy shares of any private Korean firm without the consent of the board of directors and without governmental approval. In addition, foreigners can now purchase up to 50% of the outstanding shares of some public corporations. And furthermore, both domestic and foreign investors are permitted to make all types of acquisitions - including hostile takeovers of Korean corporations.
Foreign investment is being fully liberalised for all industries except those involving national security, cultural considerations such as the mass media, and certain sectors subject to negotiations over foreign investment such as the communications and shipping industries. All limits on foreign investment in the local bond and money market have been eliminated, as has the ceiling on foreign investment in the stock market.
Private investors, both domestic and foreign, can now easily establish mutual funds in Korea. The government has also developed an institutional framework for mutual funds, so that these funds can be used for long-term financing.
Foreign banks and securities companies are now allowed to establish local subsidiaries in Korea, and all financial institutions meeting certain requirements are allowed to conduct foreign exchange transactions. And lastly for the moment: when purchasing land for either business or non-business purposes, foreigners will now be treated equally with Korean nationals. |
