Facility investment by S. Korean firms to grow 12.2 pct in 2010: survey

SEOUL, Nov. 29 (Yonhap) -- Major South Korean companies are expected to increase
their capital spending for facility investment next year as the real economy
regains its footing, according to a survey released Sunday by a state-run bank.
The survey of the country's 3,600 major companies conducted by the Korea
Development Bank (KDB) forecast their combined investment for facilities to gain
12.2 percent from a year ago to total 95.1 trillion won (US$80.5 billion) in 2010
after contracting an estimated 4.4 percent for this year.
The upbeat investment projection comes as the manufacturing sector is expected to
sharply increase facility spending next year, led by the information-technology
industry, the nation's biggest exporter, the KDB said in a statement.
"The 2010 investment outlook is especially positive, as it shows a rise in
corporate spending for new products and research and development," the lender
said in the statement.
Manufacturers said they will increase spending for facility investment by an
average of 10 percent next year after reducing it by 15.5 percent in 2009, while
facility investment outlays by non-manufacturers may continue to increase 4.5
percent following an 11.3 percent gain this year, according to the survey.
The upbeat prediction followed a series of forecasts that put growth outlooks for
Asia's fourth-largest economy at higher than 4 percent.
The state-run Korea Development Institute forecast a week earlier that the South
Korean economy would accelerate 5.5 percent year-on-year in 2010.
The economy grew 2.9 percent in the July-September period, the fastest growth in
more than seven years as exports and domestic consumption recovered.
pbr@yna.co.kr
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