(EGM) Foreign Direct Investment in Southeast Asia - Unido

FDI lens. Consequently, some IPAs have been relatively slow in formulating
policies to increase the scale and quality links of such chains, situated within
their sovereign borders.
As asset-based FDI is increasingly redistributed across OECD countries, and
relationship-based foreign involvement (FDI, FPI and, more frequently,
international contracting) is redistributed across emerging markets, IPAs
need to reassess the validity of their policy instruments. IPAs also need to
re-evaluate the analytical basis of their policy research. The significant
variables that determine vigorous FDI, and other investment activity, are
increasingly less economic, and more social capital in their properties. This
calls for greater attention to the correlation between quantitative and
qualitative, as well as economic and non-economic variables.
The increasingly blurred line between foreign portfolio investment and FDI
activity has received relatively little attention, to date. There would be merit
in examining this important nexus in greater detail, to better understand the
interplay between the two, and the role that capital and equity markets can
play in FDI promotion and support. In this context, the role of private equity
investors also merits attention, to identify ways in which this important
source of investment can be encouraged and its benefits maximised.
The increasing role played by international SMEs in FDI activity, both as
indigenous participants linked into the ‘integrated global factory’, and as
foreign investors in their own right, merits closer attention and research.
While much of the attention towards FDI activity had traditionally focused on
large MNEs, the activities and needs of SMEs are far less well understood and
would be a policy-pertinent object of empirical study. Also useful would a
study to examine institutions and instruments that might be introduced to
better harness remittances for investment in productive assets.
48