ABSTRACT
This chapter examines Korea's foreign investment policy in the context of the developmental state of the Park era. The policy approach is effective in that foreign investment contributed to the development of the technological capability of firms in several key Korean industries and provided local firms with international marketing skills. The Park administration placed the control over foreign investment within the jurisdiction of the Economic Planning Board which had established as the principal agency for the formulation of economic development plans and their implementation. The emphasis in the import substitution sector continued to be on the development of industrial infrastructure in oil refineries, petrochemicals, and general chemical industries in which Korea needed the technological skills of foreign firms. The interventionist approach of policy makers was not only evident from the channelling of investment into those industries which development planners had targeted as priorities for development but also from its utilisation to ensure positive benefits for the state.
