SOUTH Korea is rolling out the red carpet for foreign investors under government reforms introduced this year. The Reform Plans for Improvements in the Foreign Investment Environment, implemented to lure overseas entrepreneurs, came in response to President Kim Young-sam's call to make Korea 'one of the best countries for investment'. His intention is to nurture an image of Korea as a rapidly progressing, liberalising and internationalising nation amid the New World Order of the global economy. 'The thrust of the government's policy on foreign direct investment is to create a business environment conducive to free and fair competition with domestic companies,' said the Ministry of Finance and Economy. Foreign investment has slumped in recent years due to rising wages, labour disputes and other factors pushing up production costs. The government is anxious to reverse the trend. The 'bait' is promise of some of the highest investment returns in the world based on Korea's strategic location in the heart of East Asia with close links to Japan, China and the Russian Far East. 'Now, the possibility of a durable peace on the Korean peninsula is increasing, brightening the prospects for expanded South-North economic co-operation, leading eventually to unification. Investment in South Korea will be a good way to secure entry into the North Korean market as well,' a ministry spokesman said. The principal features of the reform package are: A 'one-stop' service system for foreign investors - the Comprehensive Assistance Centre in Seoul - which has been established to eliminate red tape, provide information on investing and respond to any problems experienced by foreign entrepreneurs. A move to streamline investment applications. A decision on proposals for factories is promised by the Foreign Investment Deliberation Committee within 45 days. Smaller concerns can be running within 15 days. Hi-tech foreign corporations, in particular, are being granted preferential treatment so Korea can benefit from advanced technology transfers and learn new management techniques. The ceiling on offshore borrowing to finance hi-tech enterprises has been increased from 75 per cent to 100 per cent. Tax incentives have also been increased, with a waiver on income and corporate taxes for the first five years after a company begins to make profits and 50 per cent reductions in the following three years. Similar breaks exist on property taxes, customs tariffs, excise taxes and value-added taxes. A government task force has been formed to help foreign companies settle industrial disputes and labour laws have been altered to conform to those in OECD countries since Korea is about to join the organisation.