(image: Korea Bizwire)
SEOUL, Aug. 17 (Korea Bizwire) — A string of tax havens appeared in the list of countries that invested significantly in South Korea in the first half of this year, raising concerns about a possible influx of “dirty money,” government data showed Tuesday.
The amount of foreign direct investment (FDI) in the country amounted to US$11.1 billion in the first half of this year and the Cayman Islands ranked second behind the U.S. with an aggregate investment of $1.5 billion, according to the Ministry of Trade, Industry and Energy.
Guatemala ($571 million), Malta ($264 million) and the Virgin Islands ($221 million) also featured in the top ten.
Given the size of their population and economic output, most of these nations cannot afford to make massive investments in South Korea.
These countries do, however, have some similarities. They are tax havens that have very low tax rates or impose no income, corporate, and inheritance tax on individuals or businesses.
With limited corporate regulations, they guarantee anonymity in financial transactions.
Switzerland, a country that is famous for guaranteeing secret transactions, ranked No. 11 with $172 million.
“In many cases, the capital flowing into South Korea through tax havens is for mergers and acquisition (M&A) purposes,” a ministry official said.
J. S. Shin (js_shin@koreabizwire.com)
