(EGM) Foreign Direct Investment in Southeast Asia - Unido
(EGM) Foreign Direct Investment in Southeast Asia - Unido
(EGM) Foreign Direct Investment in Southeast Asia - Unido
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The <strong>in</strong>creas<strong>in</strong>g significance of outsourc<strong>in</strong>g (of both production and services)<br />
associated with FDI, and as a substitute for FDI, implies that the emergence<br />
of ‘campuses of manufactur<strong>in</strong>g’ (evolv<strong>in</strong>g from <strong>in</strong>dustrial parks) needs to be<br />
factored <strong>in</strong>to <strong>in</strong>vestment promotion policies. Cluster development <strong>in</strong> relation<br />
to knowledge-based <strong>in</strong>stitutions would be a significant determ<strong>in</strong>ant of<br />
attract<strong>in</strong>g FDI. In addition, FDI target<strong>in</strong>g policies need to account for specific<br />
‘types’ of FDI outsourc<strong>in</strong>g by lead<strong>in</strong>g MNEs.<br />
Commentary and discussion<br />
Peter Buckley noted that national competition and corporate<br />
complementarities <strong>in</strong> FDI posed challenges for policy craft. Policies need to<br />
address whether MNEs strategies are evolv<strong>in</strong>g globally or regionally. In<br />
general, analysis po<strong>in</strong>ts to MNEs strategies <strong>in</strong> EU, North America as regional,<br />
<strong>in</strong> contrast to those <strong>in</strong> <strong>Asia</strong> as global (exports from <strong>Asia</strong> to the rest of the<br />
world). Campuses of manufactur<strong>in</strong>g could be viewed as new growth poles,<br />
which could attract outsourc<strong>in</strong>g manufactur<strong>in</strong>g services providers.<br />
As a consequence, regional policy coherence is of vital importance <strong>in</strong><br />
reduc<strong>in</strong>g the policy temptations of compet<strong>in</strong>g for FDI through <strong>in</strong>centive wars.<br />
Contemporaneously, ASEAN ‘could do better’ <strong>in</strong> terms of perceptions of the<br />
quality of governance <strong>in</strong> the region. Additionally, the perceived low capacity<br />
levels of IPAs were a matter for urgent attention among policy-makers. The<br />
difficulties posed by bilateral trade agreements (BTAs), bilateral <strong>in</strong>vestment<br />
treaties (BITs), double taxation treaties (DTTs) with regional trade<br />
agreements (RTAs) was recognised as requir<strong>in</strong>g <strong>in</strong>creased policy resources,<br />
with the caveat that BTAs can often skew resource allocations.<br />
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