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Foreign Direct Investment Inflow and Investment Climate in ASEAN Least Developed Countries

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Economic Law Reforms in the ASEAN Emerging Economies

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Abstract

ASEAN least developed countries, that is, Vietnam, Myanmar, Cambodia and Lao PDR are trying to diversify their manufacturing sector and exports through receiving foreign direct investment (FDI). However, there is fierce competition to obtain high grade FDI. Accordingly, this paper investigates the FDI inflows to these countries and their investment climate for their further development. According to the comparison, Vietnam has received more FDI than the other countries in the manufacturing sector such as motorcycle, car, mobile phone and electrons and can diversify the exports. However, Vietnam still cannot develop the supporting industries especially the local suppliers. The other three countries cannot receive adequate FDI in Manufacturing. Although the obstacles of investment differ from country to country, quality of workers, electricity and corruption are main obstacles for several countries. This paper compares the investment climate by using the JETRO Survey on Business Conditions of Japanese Companies in Asia and Oceania, Human Capital Index by World Bank, and Worldwide Governance Index. The result of comparison shows that Vietnam is remarkably better on most of investment climate. The other three countries are required to improve quality of workers, infrastructure and governance.

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Author information

Authors and Affiliations

  1. Kobe University, Center for Social System Innovation, GSICS Bldg 2-1 Rokkodaicho, Nada-Ku, Kobe, 657-8501, Japan

    Terukazu Suruga

  2. House Unit No. 43, Houiyhong Village, Chanthabouly District, 01000, Vientiane Capital, Lao People’s Democratic Republic

    Phanhpakit Onphanhdala

Authors
  1. Terukazu Suruga
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  2. Phanhpakit Onphanhdala
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Correspondence to Terukazu Suruga .

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Editors and Affiliations

  1. Center for Social System Innovation, Kobe University, Kobe, Japan

    Terukazu Suruga

  2. Vientiane Capital, Lao People's Democratic Republic

    Phanhpakit Onphanhdala

  3. Center for Social Systems Innovation, Kobe University, Kobe, Japan

    Yuka Kaneko

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Suruga, T., Onphanhdala, P. (2023). Foreign Direct Investment Inflow and Investment Climate in ASEAN Least Developed Countries. In: Suruga, T., Onphanhdala, P., Kaneko, Y. (eds) Economic Law Reforms in the ASEAN Emerging Economies. Kobe University Monograph Series in Social Science Research. Springer, Singapore. https://doi.org/10.1007/978-981-99-1556-9_1

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  • DOI: https://doi.org/10.1007/978-981-99-1556-9_1

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  • Publisher Name: Springer, Singapore

  • Print ISBN: 978-981-99-1555-2

  • Online ISBN: 978-981-99-1556-9

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