"In terms of specific procedures, companies looking to be listed need to choose a managing underwriter, after which it will only take six months from preliminary evaluation application submission to begin trading as a publicly listed company. In other words, as long as companies pass the overseas listing evaluation, KRX will meet the demand for fast financing in the shortest possible time," explained Ma Jun, a lawyer with Ma Linjiang Law Firm, general advisor for Sichuan Kaiyuan Group, which plans to list in Korea in 2007.

The initial fee and the annual fee for listing in Korea are lower than in the United States, London and Hong Kong. Specifically, "the average underwriting fee is only 5 percent of the financing amount, which is similar to the listing fee of domestic Chinese markets," said Ma Linjiang, Director of Ma Linjiang Law Firm. "Whereas in Hong Kong and Singapore, the underwriting fee is 8-10 percent of the financing amount. It is as high as 10-15 percent in the United States and London." In terms of listing procedure, the Korea Financial Supervisory Commission has implemented a registration and recording system rather than an approval-based system. The key is whether or not the KRX is confident in the company and permits its listing. In addition, foreign companies issuing stocks and financing in Korea are not restricted in overseas remittance. And in the purpose of financing, they only need to fulfill the obligation of declaration for foreign exchange management.

Will a Chinese company really list?

At KRX's listing promotion conference, many Chinese companies expressed their concern about the fact that up until now not one foreign company has been listed in Korea. "Is there sufficient capital in Korea to be invested in the foreign companies listed on the Korean market?" A representative from a Shanxi company asked.

KRX staff said that there is no need for concern. According to them, the Korean stock market pays great attention to the overseas market. By late September 2005, the amount of foreign stock investment reached $12.8 billion. Institutional investors including insurance companies, banks and investment trusts, also continue to expand their investment in overseas stock markets. And as a result, by late September 2005, their overseas stock investment reached $ 34.7 billion.

The Korean stock market warmly welcomes well-performing foreign companies to go public in Korea. "We have accumulated sufficient investment demand and experience," said a KRX official. Moreover, Koreans have an increasing interest in Chinese stocks. By June 2006, the total overseas stock investment from Korean investors reached $44.2 billion, one fourth of which was invested in Chinese stock funds.

"With the increase of Korea's direct investment in China, Korean investors' understanding of Chinese economic development and Chinese companies is deepening. There will be sufficient investment demand in the market when well-performing Chinese companies with great growth potential raise capital and issue stocks in Korea," said the KRX official.

Numbers may help some companies get over their concerns. In 2005, the Korean stock market index increased 54 percent, and on May 11, 2006, it made a new historic record, reaching 1,464.7 points. By December 30, 2006, 1,695 companies were trading on the KRX, with a total market value of 784 trillion Korean won ($833.4 billion).

Favoring manufacturing companies

Korea's overseas investment focuses on the manufacturing industry and the wholesale and retail industry. By August 2005, the Korean manufacturing industry invested $29.86 billion overseas, 53 percent of the total investment. Overseas investment from the wholesale and retail industry reached $12.13 billion, 22 percent of the total investment. We can see the importance of the manufacturing industry in the Korean national economy and its advantage in global competition.