At the end of July, South Korea’s direct investment reached US$10.33 billion, according to the Korea Trade-Investment Promotion Agency.

Singapore was second with $9.69 billion, followed by Taiwan with $9.1 billion, it said.

In the first seven months of this year alone, South Korea's investment in the country stood at $1.43 billion compared to Singapore's $1.31 billion, the agency said.

Vietnam has become one of South Korea's biggest business partners since they normalized relations in 1992.

Bilateral trade soared to $4.85 billion last year from $490 million in 1992, according to South Korean figures.