Foreign Direct Investment in Southeast Asia

Foreign direct investment in Southeast Asia is a major factor for the development of the countries of this region. The economic growth and development of these countries is largely related to the foreign direct investments made in these countries.
According to several surveys and analysis by the experts as well as by a number of organizations, the foreign direct investment in Southeast Asia plays a decisive role in determining the trading capacity of Southeast Asian countries. As a result of this factor, the Southeast Asian countries are competing with each other to attract foreign direct investment.

According to the available data, most of the foreign direct investment in Southeast Asian countries has been done in the countries like Malaysia and Indonesia.

These countries have attracted a huge portion of the foreign direct investment that came to the region. Malaysia received nearly US$3.97 billion as foreign institutional investment in 2005. At the same time, Indonesia received almost US$4.62 billion.
In 2005 the entire Southeast Asian region along with South Asia and East Asia received nearly US$165 billion as foreign institutional investment. The development of these regions has attracted the investors and so the percentage of investment is also rising at a rapid rate. The total growth was 19% in the year 2005.

There are a number of factors related to the foreign direct investment in Southeast Asia. Firstly, because of the globalization factor almost all the national markets in the region were opened for the foreign direct investment. At the same time, to remain ahead in the competition, the Southeast Asian countries introduced a number of modifications to their national rules and regulations related to the investment sector.

On the other hand, the policy makers of the countries of Southeast Asia are facing some big challenges because the foreign investments are coming at a good rate in the region and channelizing these investments in the right sector is the most important factor. If these investments can be channelized properly, it will stimulate the rate of development in the countries of Southeast Asia.

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Last Updated on : 5th July 2013