Asia continues to be attractive FDI destination: HSBC report

21 Jul '23

2 min read

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Insights

Foreign direct investment continues to pour into Asia, and much of this is focused on manufacturing, which should cement the region's position as the centre of global trade, HSBC recently said.
Relative to the size of economies, inflows are especially large in Vietnam, Malaysia, Australia and New Zealand; far less so in South Korea, mainland China and Japan.

Foreign direct investment (FDI) continues to pour into Asia, and much of this is focused on manufacturing, which should cement the region's position as the centre of global trade, HSBC recently said.

Relative to the size of economies, inflows are especially large in Vietnam, Malaysia, Australia and New Zealand; far less so in South Korea, mainland China and Japan, it said.

In a recent report, HSBC said the Association of Southeast Asian Nations (ASEAN) has pushed past mainland China for the second year in a row, especially when it comes to new, rather than repeat, investment.

Manufacturers from mainland China, meanwhile, are increasingly investing in other economies as well, notably in ASEAN, the report noted.

The pandemic has not dented Asian FDI flows in a major way and the continent remains a pretty good destination for investment, the bank said.

In Vietnam, Malaysia, New Zealand, Australia and the Philippines, FDI inflows top 2 per cent of the gross domestic product (GDP) compared to 1 per cent in South Korea, Japan, mainland China and Bangladesh.

The total disbursed FDI volume in Vietnam reached $10.02 billion in the first half this year—a year-on-year rise of 0.5 per cent. FDI inflows into the country reached $13.43 billion in the first half—down by 4.3 per cent year on year, the ministry of planning and investment said.

Fibre2Fashion News Desk (DS)