South Korea Investing More in U.S. to Get Technology : Trade: Cheaper Asian producers force Korean firms to de-emphasize low-tech products. They need help getting into sophisticated goods.

Last year South Korea, a developing country, invested more in the United States than vice versa.

Why?

South Korean firms want to win both a stable share of the rich U.S. market for their exports and access to American technology, Korean experts say.

“Many Korean companies are way behind in R&D;, such as software development. To acquire this much-needed technology, Korean companies have no choice but to invest in the U.S.,” says Jong Ki Bae, director of the Korea Institute for Industrial Economics and Trade in Washington.

Although South Korea has been wrestling with a growing trade deficit with the United States--it climbed to $335 million in 1991--South Korean companies invested about $400 million in the United States last year. The United States, with a per-capita income four times greater than Korea’s $5,400, put only $300 million into the Asian country.

The United States is Korea’s largest market, absorbing 26% of its exports. More than a third of last year’s $18.6 billion in goods arriving in the United States were electronic products.

Korean electronics companies are in a transitional period. Over the last 30 years, the country’s electronics industry has concentrated on low-tech items, including radios and cassette players. But with less developed countries such as China, Indonesia and Thailand producing the same goods more cheaply, Korean firms can no longer compete.

As a result, they are going into high technology, Korean experts say. But they have had little help from Japan. “The Japanese have refused to share new technology with us,” Bae complains, forcing Korean companies to turn to the United States. Here, they can invest in small- and medium-size research and development facilities in California’s Silicon Valley.

Two months ago, Hyundai Business Group, one of South Korea’s giant corporations, decided to move its computer manufacturing facility from Seoul to San Jose. Hyundai plans to invest $50 million the next two years, according to Edward Thomas, president of Hyundai’s PC operation.

“Hyundai was very slow to develop new computer products and respond to the U.S. market,” says a Korean trade official in New York who asked not to be identified.

Locating manufacturing facilities closer to customers is more economic and will cut the 12- to 18-month product development time in half, Thomas says.

With a faster market response and aggressive pricing, Hyundai hopes to capture 3% to 4% of the U.S. personal computer market by 1993, Thomas says.