China's near-term focus will accelerate slower growth

2018 ◽  
Keyword(s):  
Land Use ◽  
Monetary Policy ◽  
Foreign Direct Investment ◽  
Central Bank ◽  
Direct Investment ◽  
Outward Foreign Direct Investment ◽  
Content Type ◽  
Second Home ◽  
Near Term ◽  
The Government

Subject China Q3 GDP. Significance China's GDP grew by 6.5% year-on-year in July-September, the weakest since 2009 and sparking policy loosening. Fears of encouraging more debt take-up and renminbi weakness will mean the government will contribute more to stimulus efforts than the central bank. Both are calibrating their efforts to prioritise helping households and small and medium-sized firms over larger state-owned enterprises, property developers and second-home owners. Impacts Policy subtly shifting from immediate infrastructure to land use and social security is promising, and vital for a richer, ageing country. There is more room to expand fiscal than monetary policy; a fall in the renminbi against the dollar could discourage bilateral investment. China’s inward and outward foreign direct investment (FDI) is up in 2018 despite lower US-China FDI; other nations will partner China.

Bangladesh economy will ride out pandemic crisis

2021 ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Sri Lanka ◽  
Central Bank ◽  
Foreign Exchange ◽  
Direct Investment ◽  
Low Risk ◽  
Content Type ◽  
Speed Up ◽  
The Government ◽  
Roll Out

Significance In late May, it approved a three-month, USD200mn currency swap with Sri Lanka to help ease Colombo’s foreign exchange woes. The move underscores its growing economic strength, even as it battles the fallout of the COVID-19 pandemic. Impacts The government will step up efforts to procure more COVID-19 jabs as it tries to speed up the vaccine roll-out. Bangladesh will attract more foreign direct investment, especially from Chinese- and Japanese-based multinationals. The central bank will continue to invest reserve assets in low-risk instruments overseas.

Understanding foreign direct investment in Indonesia

2016 ◽  
Vol 15 (1) ◽  
pp. 28-50 ◽  
Author(s):  
Sasidaran Gopalan ◽  
Rabin Hattari ◽  
Ramkishen S. Rajan
Keyword(s):  
Foreign Direct Investment ◽  
Data Analysis ◽  
Direct Investment ◽  
Policy Implications ◽  
Fdi Inflows ◽  
Content Type ◽  
Greenfield Investments ◽  
The Government ◽  
Data Investigation ◽  
Existing Data

Purpose This paper aims to examine the dynamics of foreign direct investment (FDI) inflows into Indonesia. It is interested specifically in analysing and deliberating on two important policy questions: First, are all kinds of FDI useful from a policy perspective and what does the existing data on FDI reveal about the type of FDI inflows into Indonesia? Second, does the existing data help understand the extent of de facto bilateral linkages between Indonesia and other countries? Design/methodology/approach The paper offers an in-depth case study of Indonesia using extensive exploratory data analysis on FDI inflows into Indonesia. As discussed in the paper, the data investigation uses and reconciles available FDI data both from national and international sources to understand the usefulness of such data for policy analysis. Findings A data investigation of the trends in different types of FDI flows reveals a discernible downward trend in the ratio of mergers and acquisitions (M&A)–FDI ratio over the years. The paper argues that from a sequencing perspective, while a medium-to-long-term framework encouraging both domestic and foreign Greenfield investments could help Indonesia regain its growth luster, in the near term much more attention needs to be paid to FDI inflows in the form of M&As. Further, reconciling FDI and M&A data might help identify the original sources of FDI flows because existing data are based on flow of funds rather than ultimate ownership. Practical implications Since the Asian financial crisis, Indonesia has successfully embarked on a phase of economic and political transition post-Suharto, with the cornerstones of such a strategy being a process of greater democratisation and decentralisation. However, there have been growing concerns of economic growth stagnation in recent years. One of the policies to revive the economy’s lustre adopted by the government has been to attract greater FDI inflows. In this light, this paper examines the dynamics of FDI into Indonesia and deliberates on what kinds of FDI policymakers should focus on attracting to restore the country’s growth lustre. Originality/value The question of whether a policy to attract FDI should be careful in distinguishing the kind of FDI it wants to attract has not been sufficiently addressed in the related literature. This paper provides a framework to understand the different macroeconomic policy implications of types of FDI and provides extensive data analysis to not only understand the types of FDI but also sources of bilateral FDI inflows to Indonesia by reconciling FDI and M&A data.

Chinese outward foreign direct investment

2018 ◽  
Vol 34 (4) ◽  
pp. 10-12
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Design Methodology ◽  
Reading Time ◽  
Outward Foreign Direct Investment ◽  
Foreign Markets ◽  
Content Type ◽  
Pertinent Information ◽  
Strategic Motives ◽  
Practical Implications

Purpose This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies. Design/methodology/approach This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context. Findings This briefing looks at the strategic motives behind Chinese firms when looking to expand globally and create subsidiaries in foreign markets. Originality/value The briefing saves busy executives, strategists, and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

Fading FDI faces increasing challenges in Chile

2016 ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Foreign Investment ◽  
Direct Investment ◽  
Food Industry ◽  
Public Infrastructure ◽  
Sharp Drop ◽  
Content Type ◽  
Investment Promotion ◽  
The Government

Subject The fall in foreign investment last year. Significance The government has launched a new Foreign Investment Promotion Agency (APIE) to buck a sharp drop in foreign direct investment (FDI) last year. Breaking with the country's long-standing sector-agnostic approach, the agency will seek to attract investment to specific sectors, including energy, public infrastructure and the food industry. Impacts A more business-friendly administration in Argentina could potentially divert FDI from Chile. Critics of the new FDI regulation maintain that it will dampen inflows. Efforts to attract investment in food and mining services represent a bid to diversify from mineral exports.

Indonesia's liberal reform reveals growth priorities

2016 ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Payment Systems ◽  
Content Type ◽  
Toll Road ◽  
Insurance Programme ◽  
Road Projects ◽  
Liberal Reform ◽  
National Health Insurance Programme ◽  
The Government

Subject Outlook for foreign direct investment into Indonesia's economy. Significance The government last month revised its Negative Investment List, opening 35 new sectors to foreign direct investment (FDI), especially in the services and trade segments. With these reforms, the government hopes to attract 594.8 trillion rupiah (43.52 billion dollars) of new investment this year. Impacts Firms supporting e-commerce operations, for example through developing secure payment systems, have good prospects. Land clearance hurdles facing toll road projects are unlikely to be resolved easily. The national health insurance programme will help Indonesia harness its demographic dividend.

Mexican fiscal consolidation steady despite oil price

2015 ◽  
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Oil Prices ◽  
Oil Price ◽  
Fiscal Consolidation ◽  
Significant Drop ◽  
Content Type ◽  
The Government

Subject The outlook for fiscal consolidation. Significance The significant drop in oil prices should not derail the fiscal consolidation trajectory mapped by President Enrique Pena Nieto's administration, which envisages that the debt/GDP ratio should stabilise by 2017. The fiscal hole opened by reduced oil prices has been compensated with greater taxation income and one-off revenues. Impacts Defying expectations, the oil price plunge did not push the government into an overtly contractionary fiscal correction. An arguably much-needed simplification of the cumbersome taxation regime will not take place due to the government's pledge not to alter it. Loose monetary policy from the autonomous central bank has worked in tandem with the government's fiscal stance.

Georgian protests point to more united opposition

2019 ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Political Instability ◽  
Proportional Representation ◽  
Content Type ◽  
Political Landscape ◽  
The Government

Significance Parliament's failure last month to enact the promised transition to proportional representation sparked demonstrations in Tbilisi and other cities. The ruling Georgian Dream-Democratic Georgia party's immediate position seems safe, but it will have to reckon with signs that a more confident, determined and united opposition is emerging out of the previously diffuse political landscape. Impacts A bout of political instability would reduce the inflow of foreign direct investment. Russia's instinct to exploit turmoil will be curbed by its reluctance to see the opposition win. To address one area of discontent, the government may unblock the Anaklia port project.

Georgian Dream is beleaguered but may win again

2020 ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Exchange Rates ◽  
Direct Investment ◽  
Content Type ◽  
The Government

Significance The ruling Georgian Dream party faces a more united opposition and mounting pressure from US and EU partners. Economic challenges are increasing as inflation rises, wages remain low and external state debt grows. Impacts Foreign direct investment is set to fall, worsening the outlook for recovery. The Georgian lari is likely to recover but not return to pre-pandemic exchange rates. The government is hoping to open safe 'tourist corridors' to encourage foreign visitors to return. Pro-Russian parties may win some parliamentary seats.

Risks are high despite Turkey’s policy 'normalisation'

2020 ◽  
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Risk Premium ◽  
Financial Stability ◽  
Foreign Debt ◽  
Content Type ◽  
The Public ◽  
High Inflation ◽  
The Government

Significance With the lira at a record low, the Central Bank continued to tighten monetary policy this week, funding the market through competitive one-month repo tenders at rates of around 12.5%. In recent weeks, the government and Central Bank have taken a series of steps to modify the expansionary and in some cases unorthodox policies adopted during the COVID-19 pandemic. Impacts Foreign portfolio investors could shun the Turkish market for some more months, and the risk premium will remain high. Although this year’s annual contraction in GDP, at 3-4%, may be less severe than expected, the recovery may decelerate or be interrupted. The lira may fall further with concerns about foreign debt, forex reserves, budgets, inflation and financial stability persisting into 2021. Given the weak lira, the jobs crisis and high inflation, the government will struggle to persuade the public it has managed the crisis well.

Political risk distribution of Chinese outward foreign direct investment

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Qiuyu GaoYan
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Multinational Enterprises ◽  
Risk Index ◽  
Political Risk ◽  
Principal Component ◽  
Government Support ◽  
Outward Foreign Direct Investment ◽  
Content Type ◽  
Risk Distribution

PurposeThe purpose of this paper is to contribute to a better understanding on relations between Chinese Outward Foreign Direct Investment (OFDI) and host country political risk. To contribute to a better understanding of whether traditional wisdom on foreign direct investment (FDI) is sufficient to explain the internationalization of Chinese multinational enterprises, the author collected 15 proxy variables from the PRS Group and Heritage Foundation and applied principal component analysis (PCA) to construct a new political risk index (PRI) that measures multiple facets of political risk for 139 countries.Design/methodology/approachUsing this new PRI as a criterion, the author investigated changes in the political risk distribution (PRD) of Chinese outward FDI (OFDI) regarding investment destinations, large projects, annual investment outflows and sectorial distributions from 2006–2017.FindingsThe author found that the vast majority of Chinese OFDI during this period is concentrated in moderate- and low-risk countries, even at the sectorial level. This paper also shows that the continuing reform of Chinese OFDI policy and strong government support have led to an unprecedented increase in Chinese OFDI, while the PRD of Chinese OFDI has maintained a gradual decline over the past decade.Originality/valueThis research provides a new measurement that covers multiple facets of political risk.

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