Korea’s foreign investment ranking falls to 17th among the world’s 30 largest economies, marking a sharp downturn. According to Bank of Korea data, foreign direct investment dropped significantly in 2024 compared to the previous year. This decline followed the controversial martial law declaration on December 3 by former President Yoon Suk Yeol. That event shook investor confidence, disrupted financial markets, and triggered immediate political instability. Consequently, many foreign investors delayed or scaled back planned investments.
During the fourth quarter of 2024, the investment drop became even more alarming. Korea saw a $1.18 billion decline in foreign inflows during that period alone. This was the country’s worst quarterly performance since early 2020 during the pandemic’s onset. Notably, Korea dropped nine places to rank 23rd in quarterly inflow rankings. Korea’s foreign investment ranking falls to 17th largely because of these fourth-quarter losses.
Overall, Korea’s foreign investment ranking falls to 17th after reaching 13th the year before. In 2022, the country had ranked 14th, showing a brief upward trend. However, the political fallout in late 2023 reversed those gains sharply. Annual foreign investment into Korea dropped to $37.18 billion, down 33.8 percent year-on-year. Experts warn this gap between capital inflow and outflow could harm long-term competitiveness.
Meanwhile, outbound investment from Korea surged, climbing three spots to rank 10th globally. Korean firms aggressively expanded manufacturing abroad while retail investors bought large amounts of foreign assets. The total outbound investment reached $120.8 billion in 2024, growing 55.7 percent year-on-year. Many companies also opened new facilities overseas, especially in manufacturing sectors. This trend reflects growing concern about Korea’s domestic business environment.
In the first quarter of 2025, outbound investment surged again, hitting $46.2 billion—its highest since late 2021. If this trend continues, Korea may rise even further in the outbound rankings. However, as Korea’s foreign investment ranking falls to 17th, concerns about economic balance persist. Analysts suggest that the imbalance could slow growth and erode industrial strength. Trade officials have pledged stronger efforts to attract foreign firms back to Korea.
