A Federation of Korean Industries survey revealed that Korea’s 600 biggest businesses intend to increase spending 12.1% to an all-time high of KRW 140.8 trillion ($123.9 billion) in 2012. Facility spending is projected to grow 10.9% to make up 80% of total spending, and R&D spending is slated to grow 16.9% to account for 20%. Spending in the manufacturing and nonmanufacturing sectors should grow 11.3% and 13.6% to KRW 93.3 trillion and KRW 47.3 trillion, respectively. Respondents named bolstering competitiveness and new projects as the primary reasons for the investment upsurge. Policy-related incentives that respondents cited as impacting investment included “fostering of new growth engines” (26%), “assistance for fund-raising” (20%) and “taxational supports” (18%). For 70% of respondents, the economic factor most impacting investment was the uncertainty of the domestic economy. For 32% of respondents, political uncertainty was the largest noneconomic factor. Investment grew 7.6% in 2011 to KRW 125.6 trillion. That year, facility spending grew 7.6%, and R&D spending grew 4.0%.

Source: Federation of Korean Industries