4 out of 10 S. Korean conglomerates yet to establish investment plans for 2026
Seoul, Dec 8
Four out of 10 South Korean conglomerates have not yet established their investment plans for 2026 amid growing uncertainties in the business environment, an industry survey showed on Monday.
The Federation of Korean Industries (FKI), a major South Korean business lobby, recently commissioned pollster Mono Research to survey the country's top 500 companies by sales on their investment plans for next year, reports Yonhap news agency.
Of the 110 companies that responded, 43.6 per cent said they have not yet drawn up investment plans for 2026, while 15.5 per cent said they have no investment plans at all. Only 40.9 per cent said they had finalized their plans, the FKI said in a press release.
Companies that have not set their 2026 investment plans cited business reorganization, the need to assess internal and external risks, and uncertain economic prospects at home and abroad as key reasons for the delay, the FKI said.
More than half of the companies that have finalized their plans said they will invest at levels similar to those of this year.
Survey results also indicated that unfavorable business conditions -- including persistent trade risks and the won's weakness against the U.S. dollar -- have increased the investment burden for many companies.
Meanwhile, 36.4 percent of respondents said they have established or are considering investment plans related to artificial intelligence (AI).
When asked about major challenges for next year, companies pointed to the expansion of protectionist measures, such as tariffs and growing supply chain instability, economic slowdowns in major countries, including the United States and China, and the strong dollar.
Meanwhile, South Korean shares narrowed losses late Monday morning but continued to trade lower as investors took a wait-and-see approach on a possible rate cut by the U.S. Federal Reserve this week.
The benchmark Korea Composite Stock Price Index (KOSPI) fell 1.54 points, or 0.04 per cent, to 4,098.51, as of 11:20 a.m.
The two-day Federal Open Market Committee meeting is set to kick off on Tuesday (U.S. time), with market watchers widely anticipating a 0.25 percentage point cut.
— IANS
Reader Comments
Interesting that over a third are looking at AI investments. That's the key takeaway. Even in uncertain times, tech transformation is non-negotiable. Indian IT firms should see this as an opportunity to partner with Korean companies on their AI journeys.
Wait-and-see approach makes sense. With the Fed meeting and elections in major economies, the global picture is hazy. Better to hold cash than make a wrong bet. Our own RBI will be watching the Fed closely too.
The report mentions "supply chain instability" as a major challenge. This is where India has a real chance to attract manufacturing if we get our infrastructure and policies right. 'China plus one' is still a live strategy for many firms.
Respectfully, while the data is concerning, the sample size is only 110 out of 500 companies. We must be careful not to over-interpret. Still, it's a useful indicator of corporate sentiment. Hope the Indian industry bodies are doing similar surveys.
Chahe Korea ho ya India, business planning is tough in this volatile world. Geopolitics, currency swings, trade wars... it's a lot for any CEO to handle. Wishing stability for all economies. ðŸ™
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.