Determination of Foreign Direct Investment (FDI) in the Manufacturing Sectors in Malaysia | Chapter 6 | Current Topics on Business, Economics and Finance Vol. 1

 The present study tests the foreign direct investment (FDI) cause in the main production sectors and the impact of FDI on economic development in Malaysia. Moreover, this study examines the link betwixt FDI and real national wage. The vector error adjustment model (VECM) is used to estimate FDI determinants and the link middle from two points FDI and real national earnings.Foreign direct investment (FDI) is a vital chauffeur for economic progress in a country. Hence, FDI determinants should be labeled in order to advance FDI. FDI could stimulate business-related growth and economic progress could intrigue FDI. A variety of policies be going to be implemented to advance FDI as FDI determinants are not the same for all subsectors of the production sector in Malaysia. Promoting FDI can be challenging in globalisation of the world saving today than before. The government be going to promote FDI that encourages the development of the domestic manufacturing. Many manufacturing sectors are raise to be considerably influenced by autocracy and state. It has been discovered that increase has a negative impact on FDI in the transport supplies sector. It is discovered that the Asian fiscal crisis of 1997–1998 had a meaningful impact on FDI in the chemical and synthetic products sector in addition to the petroleum production sector. These findings tell that FDI determinants are to some extent the same for all the manufacturing areas. Therefore, FDI would be attracted through a sort of policies. The areas of basic metal merchandise, chemicals, and chemical fruit are found expected Granger causes of real national pay, whereas the area of petroleum products is establish to be Granger cause of FDI. These findings show a relation between FDI and economic growth. Malaysia's economy can continue to evolve thanks to FDI. FDI is essential for economic growth.

Author(s) Details:

Wong Hock Tsen,
Faculty of Business, Economics and Accountancy, Universiti Malaysia Sabah, Jalan UMS, 88400 Kota Kinabalu, Sabah, Malaysia.

Please see the link here: https://stm.bookpi.org/CTBEF-V1/article/view/9709