Patterns And Determinants Of FDI From Korea To China

China is one of the most important investment destinations of Korea. Korean enterprises have invested into China to find lower product costs and more growing market. In the past, large portion of Korean direct investment was from small and medium enterprises and focused on geographically adjacent Shandong and Dongbei tri-provinces with relatively small amount per case. However, recently, the amount of investment per case is getting bigger and investment in Yangtze delta area has increased to obtain better environment for Chinese domestic market and export. This paper includes recent patterns of FDI from Korea to China and studied determinants of Korean FDI into China by empirical analysis. From the empirical study, this paper found that limited market growth which is measured by real GDP growth rate in Korea has pushed Korean enterprises to invest in China to seek more growing markets and Korea's industry structure which is not good for labor-intensive industries has made enterprises to invest in China to find lower production costs.