Investment in korea presentation

INTRODUCTION

Korea’s economy is the 15th largest economy in the world by

GDP, after the world’s financial-economic crisis in 1997

Fast growing, solid long-term policy, stable economy

Educated labor force

Advantage in location

High export and import rate

OVERVIEW OF THE

ECONOMY

1.Domestic Economy

2. Export and Import

3. Fields of Industry

i. Steel

ii. Electronic

iii. Automobile

iv. Shipbuilding

OVERVIEW

Domestic economy

Statistic

Jan/ 2011

Interest rate 2.75%

Inflation rate 3.5%

Unemloyment rate 3.7%

Growth rate 0.50%

OVERVIEW

Export and Import

KOREA’S BALANCE OF TRADE

Export $44340.0 million

Import $40600.0 million

OVERVIEW

i. Steel

6th largest steel producer world-wide

High domestic demand

ii. Electronic

High growth rate in 20th century

Decline later due to competitive pressures from Japan and South-East Asia

iii. Automobile

World largest producer

One of most important industries to promote export

iv. Shipbuilding

World leader

Developing additional services – oil supertankers, oil drilling platform, etc.

OVERVIEW

INDUSTRIES

ENVIRONMENT

• Foreign investors will have accesses to invest in

virtually all types of business in Korea

• Potential foreign investors only have to ‘notify’ the

relevant government authorities rather than to

‘seek’ for a consent.

Foreign Investment Promotion Act

• 1,148 industrial sectors, only 31 sectors remain closed

• 7% appreciation in 2010 to over $10 billion

• Tight monetary policy to curb hot money inflows and foster financial system

stability

ENVIRONMENT

INVESTING

HARDWARE

- Advantage location

- Infrastructure

- Developed ship-building

- industry

SOFTWARE

- Educated labor force

- Supporting policies

- Up-coming industry

- Low operating cost

INTERNAL

ADVANTAGES

Busan port

Jinhae Free Economic Zone

INCHEON AIRPORT

EXTERNAL

FACTORS

Globalisation

- World new economic trend

- Economic organizations member: APEC, AFTA + 3

- Emerging of logistic markets

0

50

100

150

200

250

300

350

Korea China Japan Singapore Hongkong Taiwan

$ billion

COMPETITORS

ANALYSIS

• China

Strengths: cheap labor force, large market, high purchasing power

Weaknesses: tight policies and information censors, high corruption rate

• Taiwan

Strengths: developed information technology

Weaknesses: political risk

• Japan

Strengths: advantage locations, reliable labor force

Weaknesses: elderly populations

SUPPORTING REGULATION & POLICIES

- Free economic zones

- Tax break: 7 years tax break in 2009 for free economic zone

- Open policy

- Vision: 2020 global logistic powerhouse –

To create power health throw logistic industry

Build and update hardware infrastructures

Strengthen software oriented logistics systems

Activate the logistic industry

Establish national logistics base system

SWOT ANALYSIS

Strengths

-Well equiped facilities and educated

labor force

- Highly supporting policy

- Geography advantage

- Developed shipbuilding industry

- Strong legal system

- Low rate of risks

Opportunities

-Asian high growth rate lead to high

growth

rate of demand for logistic services

-Shift of industry – from large

enterprises

to third-party logistic firms.

- Government supporting policies

- AFTA +3 and APEC members

Weaknesses

- Number of competitors in North East

Asia

Cost of operating due to high exchange

rate

High rate of domestic enterprise

protections

Threats

War and natural disasters

OPERATING AND SETTING NETWORK

- Setting transportation and supply network:

warehouse, port, airport, etc.,

- Purchase freight vehicles, vessels and air-crafts.

- Build-up technology and information center

- Corporate with others logistic firms to set up the network

Services:

- Offer trans-pacific flight and shipment

- Provide storage facilities and bounded-ware houses

- Provide urgently shipment between East Asia and America

Receive Storage Send out

INVESTING – HOW TO?

Notification Capital remittance

Registration

Paid-in Capital transfer

FDI company registration

FINANCIAL EXPECTANCY

0

5000

10000

15000

20000

25000

30000

35000

1st year 2nd year 3rd year 4th year 5th year

Sales revenue

Expenses

Net income

Growth rate approximate: 8.7%

Growth rate in 4 years:

43.8%

NET PRESENT VALUE

Million Bath

Year0 1 2 3 4 5

(200)

108

125

114

99

84

Total: 530 million ThB

NPV: 330 million ThB

THE END