IDEAS home Printed from https://ideas.repec.org/a/rbs/ijbrss/v14y2025i2p13-26.html
   My bibliography  Save this article

The relationship between ease of doing business and FDI attraction in South-Eastern Asia

Author

Listed:
  • Darlington Chizema

    (Sol Plaatje University)

  • Ramos E. Mabugu

    (Sol Plaatje University)

  • Christelle Meniago

    (Sol Plaatje University)

Abstract

Despite extensive research on foreign direct investment (FDI), the specific dynamics and determinants affecting FDI inflows to South-Eastern Asia remain largely unexplored. This study using Dunning's OLI theory to identify the economic determinants of foreign direct investment (FDI) and examines the correlation between FDI inflows and the ease of doing business (EODB). This study aims to examine the effect of ease of doing business indicators on foreign direct investment inflows and the degree to which they affect the volume of FDI inflows in South-Eastern Asia. Interest in the determinants of foreign direct investment has surged, as it is regarded as essential for capital inflows to poor countries. This research utilises a Fully Modified Ordinary Least Squares (FMOLS) panel regression to analyse FDI flow variations among seven countries—Brunei Darussalam, Cambodia, Lao PDR, Malaysia, Philippines, Thailand, and Vietnam—during the period from 2006 to 2019. The results indicated a substantial and enduring correlation between foreign direct investment (FDI) and the enforcement of contracts, investor protection, tax compliance, and GDP per capita. The research underscores the significance of EODB variables in attracting FDI to South-East Asia. Policymakers must prioritise enhancing the business environment by streamlining processes, including investor protection and tax system simplification. By prioritising certain sectors, governments can cultivate a more conducive environment for foreign investors, leading to heightened FDI inflows. The results suggest that targeted reforms in these critical sectors can significantly enhance South-East Asia's appeal as a foreign direct investment destination. Key Words:Foreign Direct Investment, Ease of Doing Business, Fully Modified Ordinary Least Squares (FMOLS), South-Eastern Asia

Suggested Citation

  • Darlington Chizema & Ramos E. Mabugu & Christelle Meniago, 2025. "The relationship between ease of doing business and FDI attraction in South-Eastern Asia," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 14(2), pages 13-26, March.
    • Handle: RePEc:rbs:ijbrss:v:14:y:2025:i:2:p:13-26
    DOI: 10.20525/ijrbs.v14i2.3908
    as

    Download full text from publisher

    File URL: https://ssbfnet.com/ojs/index.php/ijrbs/article/view/3908/2690
    Download Restriction: no
    File URL: https://doi.org/10.20525/ijrbs.v14i2.3908
    Download Restriction: no
    File URL: https://libkey.io/10.20525/ijrbs.v14i2.3908?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rbs:ijbrss:v:14:y:2025:i:2:p:13-26. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Umit Hacioglu (email available below). General contact details of provider: https://edirc.repec.org/data/ssbffea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.