Seoul’s ‘green growth’ initiative gets JPM boost

By Song Jung-a in Seoul
Published: June 17 2009 17:02

JP Morgan Asset Management plans to raise $1bn to invest in South Korea’s “green growth” industries such as renewable energy, becoming the first foreign group to invest in Seoul’s green initiative.
Lee Youn-ho, Seoul’s minister of Knowledge and Economy, signed a letter of intent in Washington with William Daley, vice chairman of JPMorgan Chase, the Korean government said.
JP Morgan plans to raise 60-70 per cent of the funds from local investors in Korea while the rest would come from international investors or the US asset manager itself.
The funds are expected to be invested in eco-friendly projects such as developing renewable energy including solar and wind power, carbon credit-trading, making hybrid cars and biofuels.
The deal came as Lee Myung-bak, South Korea’s President, visited Washington for a summit with Barack Obama. Mr Lee has been campaigning for the so-called Green New Deal to create future growth drivers and new jobs in an effort to ride out the economic slump.
Seoul plans to invest about Won12,000bn by 2013 in the development of “green” technology to reduce carbon emissions and boost energy efficiency. The bulk of the investment will be spent on developing environment-friendly products such as personal computers and television sets that use less power and emit less carbon dioxide.
The government expects more foreign investments in “green growth” projects as it plans to increase cash incentives for foreign investors in such industries as alternative energy, robot technology and heath-care services.
South Korea’s sales of green technologies are expected to increase from $43bn in 2007 to $150bn by 2012, according to government data.
LG Chem, a leading chemicals maker, has started building a plant to supply batteries for General Motors’s electric cars while LG Display plans to spend Won50bn on developing solar cells.
Copyright The Financial Times Limited 2009