Examining the Internationalisation of Malaysian Housing Developers Using the Eclectic Paradigm

Abstract

The international expansion of housing developers from developing countries is a fairly recent phenomenon. This paper examines the internationalisation of several Malaysian housing developers abroad. It uses the Eclectic Paradigm as the basis for analysis. Understanding foreign market potential was regarded as the most important firmspecific ownership advantage whereas house buyer demand in Malaysia was ranked the highest country-specific advantage. Of the locational factors that the surveyed Malaysian developers considered when venturing in foreign markets, availability and cost of land ranked the highest. Protection of the firms' reputation was the strongest motivator to invest abroad directly rather than use the market mechanism e.g. licensing.

The ‘reverse bamboo network’: Sociocultural dialectics of China’s FDI in housing (FDIH) in Iskandar Malaysia

“…Crucially, the venturing firms must successfully navigate the host country’s institutional and legal environment, described as historically constructed and shaped by cultural forces (Howorth et al, 2006). In housing, international ventures by developers are driven by the need to establish an international brand and explore new markets (Abdul Aziz and Awil, 2010a; Awil, 2007; Brill, 2018). In countries that welcome FDIH, the state may implement various promotional measures, from institutional support – specialised agencies, customs and immigration, social support, etc.…”

“…Whilst IM’s internationalisation is a natural product of its location, an important strategic factor is government policy characterised by strong political leadership (Ng and Lim, 2017). As with many emerging economies, the Malaysian government has adopted internationalisation in many sectors including housing as a strategy to enhance global competitiveness and improve economic sustainability (Abdul Aziz and Awil, 2010a; Ismail, 2014). Vision 2020, a blueprint to guide Malaysia towards being a developed nation by the year 2020, was implemented during the first premiership of Dr Mahathir Mohammad (1981–2004, 2018–), where internationalisation was highlighted as an expansion strategy.…”

“…Vision 2020, a blueprint to guide Malaysia towards being a developed nation by the year 2020, was implemented during the first premiership of Dr Mahathir Mohammad (1981–2004, 2018–), where internationalisation was highlighted as an expansion strategy. In this home policy environment, overseas ventures by Malaysian housing developers spanned across countries in Asia, Africa and Australasia (Abdul Aziz and Awil, 2010a). The national development policy facilitated IM’s growth as it treated the region as ‘part of a vast economic corridor stretching from Kuala Lumpur and Singapore’ (Rizzo and Glasson, 2012: 418).…”