News
Domestic and foreign investment bolster economy
Despite the global economic downturn, Busan is emerging as a desirable city for domestic and international investment.
Busan is making an all-out effort to innovate and reinvigorate the local economy. It has taken several steps to improve its economic structure and increase its growth potential. These measures include upgrading industrial infrastructure, nurturing new growth sectors and creating good jobs.
The fruits of these efforts are becoming apparent. There are positive signs that Busan is on track for a brighter financial future.
The first of these signs is the securement of 101 billion won to finance the Busan Future Growth Venture Fund. The fund comprises 50 billion won from the Korea Development Bank, 25 billion won from the Ministry of SMEs and Startups, 10 billion won from BNK Financial Group, 5 billion won from Busan, and 11 billion won from other public and private sources. It will be managed by Korea Venture Investment.
Forty percent of the fund will support the creation and growth of small and medium-sized companies in the region in a bid to strengthen Busan's startup ecosystem.
Furthermore, according to the 2024 First Quarter FDI Trend report released by the Ministry of Trade, Industry and Energy, the reported and received amounts of foreign direct investment in Busan recorded USD 207 million and USD 205 million, respectively. It is the first time since 1997 that reported FDI exceeded USD 200 million in the first quarter, and marks a 552.9% increase over the same period last year.
This increase suggests foreign companies are strongly interested in doing business in Busan. The bulk of FDI is in the IT, manufacturing, electricity, electronics, wholesale and retail industries. Of the foreign companies that invested in Busan, six are from Singapore, four are from the United States, two are from China, one is from Hong Kong, and one is from Japan.
The uptick in foreign investment underscores Busan's rising reputation as a global financial hub. According to the Global Financial Centres Index 35, a competitive ranking of financial centres around the world, Busan ranks 27th out of 133. Busan has steadily climbed the rankings in recent years, rising from no. 51 in 2020, no. 36 in 2021, no. 30 in 2022, and no. 33 last year.
Researched and published by London-based commercial think tank and venture firm Z/Yen, the GFCI also ranks Busan no. 9 among financial centres in the Asia-Pacific region and no. 7 among 15 "Centres Likely To Become More Significant."