| This is a study about Korean firms' Foreign Direct Investment in China.Since Korea-Sino diplomatic relations started in 1992, the current investment scale into China has been reached at none-to-second rank from Korea than to any other countries in the world. At the beginning stage, the geographical adjacency was one of main factors. The investment in those years has contributed a lot to Chinese economy development in terms of technology progress, industry restructuring, employment, foreign-trade expansion and extra-ordinary high speed of economic growth.Up to now, the most fundamental motive of Korean FDI is seeking for lower labor cost, in which way what they need is to plant their production line into China and export goods from it to Korea or the other third countries.Dong-bei 3 provinces, Bo-hai area and Shan-dong province are the main regions for Korean Investment and what they are doing is simple assembly processing works for light industry. Korean firms did prefer to invest in a sole investment level since they did not focus on Chinese domestic market and any other variety of reasons. That's why Korean firms' level of localization is very low.However, recently we could find some of changes on their way of investment. Korean firms begin to put an emphasis on developing Chinese domestic market, their investment area down to inland and investing industry transferred to high-technology sectors gradually.China's entering WTO caused the change of strategy for Korean FDI because ofa totally new era of economic environment in China. It is so much meaningful to Korean firms. While getting better opportunities, they are also supposed to face new challenges and severe competitions from other MNC's and Chinese domestic companies equipped with high productivity benefited from China's opening strategy. More pierce competition is the obstacles and chances to all of challenging groups to Chinese market for up-coming era. The law of the survival of the fittest would be adopted here too and bring more futures to the fittest.Based on the above, this study are supposed to analyze theoretical basis, current status as well as problems of Korean FDI, and give an application of more efficient strategy of it in China.This thesis consists of 5 chapters.The 1 chapter is about the purpose and construction of thesis.The 2nd chapter introduces FDI theoretical background, including definition, key theory, Korean FDI's motive and related theories.The 3rd chapter analyzes Korean FDI's current status, characteristics and the study comparing with other developed countries' ones.The 4th chapter concludes proper ways of investing strategies based on reviewing of problems of Korean FDI up to now. The strategic ways are divided into 3 fields, with each of them depending upon the change in introduction of foreign investment by law, method and policy in China.The 5 th chapter summarizes a conclusion. Korean FDI firms should consider the followings: Proceeding investment in a long term for the purpose of Chinese domestic market; Accelerating localization; Expanding investment into heavy industry, high-technology industry and high value-added service sectors; Taking varieties of way in investment; Pursuing diversification in investment regions.
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