MANILA -- Association of Southeast Asian Nations (ASEAN) companies and dialogue partners European Union (EU) and India continue pouring investments in the region, pushing intra-regional investment to a record level.
The ASEAN Investment Report 2017 attributed the rise in intraregional investment to the growing financial strength and significant cash holdings of ASEAN firms and their increasing drive mainly to internationalize to build competitiveness and to access markets.
The report said higher intra-ASEAN investment last year was driven by a two-thirds increase in investment in manufacturing to USD8.3 billion, and a doubling of investment in finance to USD5 billion.
It noted many of the Fortune Global 500 companies continued to invest in the region, as they established or added plants or business functions to research and development (R&D) activities or upgraded their operations.
Investments by major global automotive multinational enterprise (MNE) have also expanded with activities in Viet Nam, the Philippines and Singapore.
“MNEs continue to participate in infrastructure development in the region in various segments of the value chain,” the report added.
The EU is the largest investor group in ASEAN in value terms, with over 9,000 EU companies operating in the region.
ASEAN is a major destination for Outward Foreign Direct Investment (OFDI) from India. About 22 percent of Indian global OFDI stock was in ASEAN in 2015.
“Major multinational enterprises (MNEs) from these countries have been present in ASEAN in a wide range of industries. Many of them operate in multiple locations across the region in different segments of the value chain,” it said.
It said foreign direct investments (FDI) inflows from China, Republic of Korea and Australia also rose last year.
But the report added while FDI flows in ASEAN remained at a high level, this was not enough to overcome a decline due to divestment, acquisition of foreign assets by ASEAN companies in their home countries and repayment of intracompany loans by affiliates within the region.
Meanwhile, the ASEAN Investment Report 2017 was launched Monday by the United Nations Conference on Trade and Development (UNCTAD) and the ASEAN Secretariat during the ASEAN Business and Investment Summit (ABIS) 2017. (PNA)
