Foreign companies operating in South Korea have paid out more than 80 percent of their profits as dividends to shareholders since 2011, data showed Wednesday, amid concerns that their spending in Asia's fourth-largest economy is on the wane.
A total of 10.1 trillion won (USd9.9 billion) was paid out as dividends to shareholders by 28 foreign firms here with annual sales of more than 1 trillion won, according to the data compiled by CEO Score, which tracks the nation's big business groups.
The figure is 80.3 percent of the combined net profit earned by them for the three years since 2011, South Korea's news agency (Yonhap) reported today.
Last year alone, the average dividend payout ratio by the foreign companies reached 131 percent of their net profit, which is five times that of the top 10 local conglomerate groups.
The large dividend payout ratio is not unusual for foreign companies operating outside of their home country.
"However, the current situation where the dividend rate is extremely high in contrast to their minor role in investment and job creation may spur criticism that these firms are taking the lion's share from their profits made in South Korea," an industry watcher said.
The highest dividend payout ratio was registered by GM Korea Co., the local unit of U.S. auto giant General Motors Co., which paid 274.5 percent of its net profit to shareholders during the cited period.
In contrast to the large dividend payouts, the number of workers at the local branches of the foreign companies slipped 3.9 percent to 83,645 last year from the 87,018 tallied in 2011. During the same period, the number for the top 10 local conglomerates went up 36.9 percent.
The overseas firms' investment in local facilities stood at 2.3 trillion won last year, also having dropped 37.6 percent from the 3.6 trillion won invested here in 2011.
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