SEOUL, Sept. 11 (Korea Bizwire) – Over the past five years, so called “China Money” pouring into Korean financial market has risen up over 50 times much in the period and is expected to grow further as China’s overseas investment will be accelerated as time advances.
According to local sources, the total balance of money originating in China which has landed in Korean stock and bond markets amounted to 23.3 trillion won(US$22.5 billion) as of July, approximately 50-fold increase from 471.1 billion won(US$455 million) at the end of 2008. Moreover, so far this year alone, Chinese money equivalent of 2.5 trillion won rushed into Korean financial market.
The market analysts say that the explosive growth of Chinese investment in Korea has resulted from the Chinese government policy shift which is increasingly to diversify its foreign currency reserves and the rising demand for alternative investment.
Due to the worldwide trend of low interest environment, Chinese state-level investment institutions including the People’s Bank of China and China Investment Corporation will raise up the ante in their investment into Korean market so that they might gain more profits given that policy rates of Korean government bonds are relatively higher than those of other countries including Taiwan.