Foreign Direct Investment in ASEAN Economies

Abstract

The economies of the Association of Southeast Asian Nations (ASEAN)—comprising Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand—have enjoyed robust economic growth rates in the past two decades. A conducive external environment, an outward-looking development strategy which emphasizes the role of foreign trade and foreign direct investment (FDI) and political, social and economic stability have contributed to economic buoyancy, high levels of investment and employment generation, rising productivity and skill development, and sharply improved export performance in manufactures. At the same time, the buoyant economies have acted as a magnet to attract further inward investment flows. Thus, FDI acts as both cause and effect in economic growth and facilitates economic upgrading…