Chinese Outward Foreign Direct Investment: Is ASEAN a New Destination?

Anh, Nguyen Thi Tuong; Doan, Hung Quang

doi:10.2139/ssrn.2794842

Cited by 3 publications

(1 citation statement)

References 29 publications

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“…In the same vein, Liu, Buck, and Shu (2005) surmise that for developing countries FDI is prompted by their state of economic development while according to You (2015) China FDI is not driven by the level of economic development in host countries. Likewise, Tuong Anh and Hung (2016) argue that Chinese investors are probably not associated with the economic growth of host countries.…”

Section: Theoretical and Empirical Reviewmentioning

confidence: 99%

Is there a nexus between China outward foreign direct investment and welfare in Côte dʼIvoire? Empirical evidence from the Toda–Yamamoto procedure

Allou

Adeleye

Cheng

et al. 2020

African Development Review

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Foreign direct investment (FDI) plays an important role in the socioeconomic advancement of developing countries. In the last decade, FDI inflows from China into Côte dʼIvoire have grown rapidly. Using quarterly time series data from 2003Q1 to 2017Q4, this study probes if China FDI has any significant welfare impact on the citizens of Côte dʼIvoire vis-à-vis if a causal relationship exists. The policy outcome is to stimulate further discourse that will reduce poverty and enhance the living standard of the population. The study uses vector autoregressive (VAR) and the Toda and Yamamoto (1995) modification of the non-Granger causality test to determine if a causal relationship exists and the direction of causality. The empirical analysis provides evidence of a unidirectional causality from China FDI to social welfare (proxied by the human development index [HDI]) but no indication of causality between China FDI to economic welfare (proxied by real gross domestic product per capita [GDPPC]). This study, which is borne out of empirical curiosity, fills a lacuna in the FDI literature. To the best of our knowledge, this paper is a novel contribution that examines the FDI-welfare nexus between China and a developing economy like Côte dʼIvoire. Thus, policies that will further stimulate FDI inflows from China must be carefully crafted to attract funding to the most productive sectors of the economy in order to improve both social and economic welfare. By extension, the policies may be adapted by developing economies with similar characteristics to Côte dʼIvoire. 1 | INTRODUCTION The "One Belt and One Road" initiative of the Chinese government allows Chinese firms to invest in Africa with a view to promoting a "win-win and multi-win cooperation" in host countries in the form of foreign direct investment (FDI). This ingenuity made Africa one of the main economic and commercial partners of China in the Sino-Afro cooperation (Yanxia & Meibo, 2015). For a successful implementation, the Chinese governmentthrough the Forum on China-Africa Cooperation (FOCAC)-implemented strategies to help African countries

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Section: Theoretical and Empirical Reviewmentioning

confidence: 99%

Is there a nexus between China outward foreign direct investment and welfare in Côte dʼIvoire? Empirical evidence from the Toda–Yamamoto procedure

Allou

Adeleye

Cheng

et al. 2020

African Development Review

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Determinants of Chinese Overseas FDI in ASEAN Countries

Jie¹,

Ismail

2019

ASEAN Post-50

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Impact of Macroeconomic, Governance and Risk Factors on FDI Intensity—An Empirical Analysis

Sujit

Kumar

Oberoi

2020

JRFM

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The study analyzes the impact of macroeconomic, governance and risk factors on foreign direct investment (FDI) intensity with respect to the US market during the period 1960–2019. The study adopted regression methodology. The FDI, macroeconomic and risk data were sourced from the Federal Reserve Economic Data (FRED) database. The governance data were collected from the World Bank Governance Database. The study suggests that infrastructural investments lead to higher FDI. A stronger Euro leads to higher FDI activity in the United States. Research & Development investments is a significant factor which contributes towards enhanced FDI activity. The higher the corporate profitability, the greater the FDI inflows. Exports and imports are significant factors which determine FDI in markets like USA. Inflation has a negative impact on FDI flow regulations, which are aimed to promote private sector development is negatively related to FDI intensity. FDI activity by firms tend to be lower when corruption levels are higher in the country. The higher the governance perception in terms of voice and accountability of citizens, the greater the propensity to attract FDI. The perception of the effectiveness of a government’s commitment towards the quality of public and civil services is directly related to FDI investment.

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Chinese Outward Foreign Direct Investment: Is ASEAN a New Destination?

Cited by 3 publications

References 29 publications

Is there a nexus between China outward foreign direct investment and welfare in Côte dʼIvoire? Empirical evidence from the Toda–Yamamoto procedure

Is there a nexus between China outward foreign direct investment and welfare in Côte dʼIvoire? Empirical evidence from the Toda–Yamamoto procedure

Determinants of Chinese Overseas FDI in ASEAN Countries

Impact of Macroeconomic, Governance and Risk Factors on FDI Intensity—An Empirical Analysis

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