earticle

영어

This study introduced the inclusion of Global Value Chain (GVC) as a strategy for the globalization of domestic industries. In addition, this study intended to highlight direct foreign investment as an important opportunity for enhancing the competitiveness of the domestic small and medium firms. That is, globalization could be realized not only through simple capital inflow, but also through domestic industry's participation in the overseas production network. The analysis of the trend and pattern of direct foreign investment revealed that the FDI inflows heavily dependent on the USA and Japan have been diversified steadily over time. In spite of recent decline trend of overall FDI amount, inflows from European countries in machinery and chemical industries have been rising. These rising and diversifying trends in these industries are promising since FDI inflows have the potential of playing an important role in achieving productivity growth of domestic industries, particularly in the area of comparatively fragile industries such as machinery and chemicals. In the same logic, it is crucial for future growth of Korea that the small and medium firms find their competitive edges through strengthening production networks with foreign multi-national companies. Thus, it is suggested that the policy of globalization of small and medium firms should be based on the firm understanding of GVC and FDI pattern of industries.