IDEAS home Printed from https://ideas.repec.org/a/spr/apjors/v9y2025i1d10.1007_s41685-024-00360-8.html
   My bibliography  Save this article

Driving force behind the investment location choice of Chinese enterprises in ASEAN countries

Author

Listed:
  • Xinyu Wang

    (Guangxi University)

  • Bingqing Yu

    (Guangxi University)

  • Shuiying Lan

    (Guangxi University)

  • Li Hong

    (Guangxi University
    Guangxi University)

Abstract

With deepening cooperation between China and ASEAN countries, the driving force of Chinese enterprises’ location choice for direct investment in ASEAN should not only consider their own competitive advantages but also consider environmental and resource factors such as geography, economy and culture of the host country. Therefore, this paper first expounds on the location choice of Chinese enterprises’ investment in ASEAN and then presents research hypotheses based on the enterprises’ own experiences and the three proximities of geography, economy and social culture. A Probit regression analysis model is adopted to analyze the evolutionary driving force of Chinese enterprises’ investment locations in ASEAN. The study reveals the following findings: First, Chinese enterprises’ investments in ASEAN countries exhibit a “clustering-dispersal” pattern in industries such as energy, transportation and real estate forming industrial clusters of various ASEAN cities. Second, the attributes of multinational corporations, including corporate characteristics, geographical factors, economic factors, and cultural factors, significantly influence the expansion of the ASEAN investment network, and heterogeneous investment preferences exist across different regions.

Suggested Citation

  • Xinyu Wang & Bingqing Yu & Shuiying Lan & Li Hong, 2025. "Driving force behind the investment location choice of Chinese enterprises in ASEAN countries," Asia-Pacific Journal of Regional Science, Springer, vol. 9(1), pages 189-222, March.
    • Handle: RePEc:spr:apjors:v:9:y:2025:i:1:d:10.1007_s41685-024-00360-8
    DOI: 10.1007/s41685-024-00360-8
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s41685-024-00360-8
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s41685-024-00360-8?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Thomas Chaney, 2014. "The Network Structure of International Trade," American Economic Review, American Economic Association, vol. 104(11), pages 3600-3634, November.
    2. Youxing Huang & Meixia Dong & Yanping Zhao, 2024. "Sister‐city Ties and Chinese Outward Foreign Direct Investment: A Spatial Econometric Analysis," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 32(1), pages 231-258, January.
    3. Lin Sun & Kexuan Zhou & Linhui Yu, 2020. "Does the reduction of regional trade policy uncertainty increase Chinese enterprises' outward foreign direct investment? Evidence from the China−ASEAN Free Trade Area," Pacific Economic Review, Wiley Blackwell, vol. 25(2), pages 127-144, May.
    4. Massimo Del Gatto & Carlo S. Mastinu, 2018. "Geography, cultural remoteness and the second nature of within-country economic development: do island regions lag behind?," Regional Studies, Taylor & Francis Journals, vol. 52(2), pages 212-224, February.
    5. Ronald Sean Wall & G. A. van der Knaap, 2011. "Sectoral Differentiation and Network Structure Within Contemporary Worldwide Corporate Networks," Economic Geography, Clark University, vol. 87(3), pages 267-308, July.
    6. Simplice A. Asongu & Joseph Nnanna & Vanessa S. Tchamyou, 2020. "The comparative African regional economics of globalization in financial allocation efficiency: the pre-crisis era revisited," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 6(1), pages 1-41, December.
    7. Henry Wai-chung Yeung, 2021. "The trouble with global production networks," Environment and Planning A, , vol. 53(2), pages 428-438, March.
    8. Yiqing Xie & Xiaobo Yu & Zhihong Yu & Yu Zhou, 2024. "Spatial outward FDI: Evidence from China's multinational firms," Review of International Economics, Wiley Blackwell, vol. 32(2), pages 574-603, May.
    9. Ronald Sean Wall & G. A. van der Knaap, 2011. "Sectoral Differentiation and Network Structure Within Contemporary Worldwide Corporate Networks," Economic Geography, Taylor & Francis Journals, vol. 87(3), pages 267-308, July.
    10. Manfred M. Fischer & James P. LeSage, 2020. "Network dependence in multi-indexed data on international trade flows," Journal of Spatial Econometrics, Springer, vol. 1(1), pages 1-26, December.
    11. repec:spo:wpmain:info:hdl:2441/7an8r1ubqs93caeqs80puld0tp is not listed on IDEAS
    12. Yang, Jiao-Hui & Wang, Wei & Wang, Kai-Li & Yeh, Chung-Ying, 2018. "Capital intensity, natural resources, and institutional risk preferences in Chinese Outward Foreign Direct Investment," International Review of Economics & Finance, Elsevier, vol. 55(C), pages 259-272.
    13. Sheng Ma & Xinxin Xu & Ziqiang Zeng & Lin Wang, 2020. "Chinese Industrial Outward FDI Location Choice in ASEAN Countries," Sustainability, MDPI, vol. 12(2), pages 1-13, January.
    14. Theresa Yan & Peter Enderwick, 2021. "Evolution Of China’S Outward Foreign Direct Investment Regime: Implications For Southeast Asia Under The Belt And Road Initiative," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 66(01), pages 143-159, March.
    15. Samina Sabir & Anum Rafique & Kamran Abbas, 2019. "Institutions and FDI: evidence from developed and developing countries," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 5(1), pages 1-20, December.
    16. Meric S. Gertler, 2003. "Tacit knowledge and the economic geography of context, or The undefinable tacitness of being (there)," Journal of Economic Geography, Oxford University Press, vol. 3(1), pages 75-99, January.
    17. Siyue Chen & Gengzhi Huang & Hongou Zhang & Yuyao Ye & Qitao Wu, 2021. "Do institutional risk preferences exist in Chinese direct investments in ASEAN countries? A case study of Chinese-funded enterprises in Laos," Journal of Chinese Economic and Foreign Trade Studies, Emerald Group Publishing Limited, vol. 14(3), pages 306-324, July.
    18. Peter Hertenstein & Dylan Sutherland & John Anderson, 2017. "Internationalization within networks: Exploring the relationship between inward and outward FDI in China’s auto components industry," Asia Pacific Journal of Management, Springer, vol. 34(1), pages 69-96, March.
    19. Jin Hong & Chongyang Zhou & Yanrui Wu & Ruicheng Wang & Dora Marinova, 2019. "Technology Gap, Reverse Technology Spillover and Domestic Innovation Performance in Outward Foreign Direct Investment: Evidence from China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 27(2), pages 1-23, March.
    20. repec:hal:spmain:info:hdl:2441/7an8r1ubqs93caeqs80puld0tp is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yongmin Zhang & Yong Chen & Renyi Zhang & Wenjun Tu & Yingxue Zhao, 2024. "Outward foreign direct investment productivity along the belt and road," Economics and Politics, Wiley Blackwell, vol. 36(2), pages 959-988, July.
    2. Zhang, Yongmin & Zhang, Zhenbang & Jin, Hanglin & Tu, Wenjun & Liu, Yingnan, 2024. "Innovation and OFDI along the Belt and Road," Technological Forecasting and Social Change, Elsevier, vol. 200(C).
    3. Zachary P Neal, 2017. "Well connected compared to what? Rethinking frames of reference in world city network research," Environment and Planning A, , vol. 49(12), pages 2859-2877, December.
    4. Yang, Xiaolan & Wang, Rui & Guo, Dongmei & Sun, Weizeng, 2020. "The reconfiguration effect of China's high-speed railway on intercity connection ——A study based on media attention index," Transport Policy, Elsevier, vol. 95(C), pages 47-56.
    5. Giulia Masi & Giorgio Ricchiuti, 2020. "From FDI network topology to macroeconomic instability," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 15(1), pages 133-158, January.
    6. Ben Derudder, 2021. "Network Analysis of ‘Urban Systems’: Potential, Challenges, and Pitfalls," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 112(4), pages 404-420, September.
    7. Weichen Liu & Jiaying Guo & Wei Wu & Youhui Cao, 2022. "The evolution of regional spatial structure influenced by passenger rail service: A case study of the Yangtze River Delta," Growth and Change, Wiley Blackwell, vol. 53(2), pages 651-679, June.
    8. Kirsten Martinus & Matthew Tonts, 2015. "Powering the world city system: energy industry networks and interurban connectivity," Environment and Planning A, , vol. 47(7), pages 1502-1520, July.
    9. Weiyang Zhang & Thomas Sigler, 2024. "Which ‘globalisations’ explain the overseas expansion of Chinese multinational enterprises through city-networks?," Environment and Planning A, , vol. 56(6), pages 1614-1631, September.
    10. Nikolay A. Sluka & Vladimir S. Tikunov & Olga Yu. Chereshnia, 2019. "The Geographical Size Index for Ranking and Typology of Cities," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 144(2), pages 981-997, July.
    11. María Verónica Alderete, 2020. "Exploring the Smart City Indexes and the Role of Macro Factors for Measuring Cities Smartness," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 147(2), pages 567-589, January.
    12. Vladimír Pažitka & Dariusz Wójcik, 2021. "The network boundary specification problem in the global and world city research: investigation of the reliability of empirical results from sampled networks," Journal of Geographical Systems, Springer, vol. 23(1), pages 97-114, January.
    13. Lucía Gómez & Päivi Oinas & Ronald Sean Wall, 2022. "Undercurrents in the world economy: Evolving global investment flows in the South," The World Economy, Wiley Blackwell, vol. 45(6), pages 1830-1855, June.
    14. Stefan Hennemann & Ben Derudder, 2014. "An Alternative Approach to the Calculation and Analysis of Connectivity in the World City Network," Environment and Planning B, , vol. 41(3), pages 392-412, June.
    15. Soha Ahmed & Faraz Zaidi & Céline Rozenblat, 2024. "Multinational Firms and the Economic Self-Reliance of North American Cities," Networks and Spatial Economics, Springer, vol. 24(4), pages 819-846, December.
    16. Stefan Krätke, 2014. "Global Pharmaceutical and Biotechnology Firms’ Linkages in the World City Network," Urban Studies, Urban Studies Journal Limited, vol. 51(6), pages 1196-1213, May.
    17. repec:osf:osfxxx:nvs79_v1 is not listed on IDEAS
    18. Marta Gancarczyk & Joanna Bohatkiewicz, 2018. "Research Streams in Cluster Upgrading. A Literature Review," Journal of Entrepreneurship, Management and Innovation, Fundacja Upowszechniająca Wiedzę i Naukę "Cognitione", vol. 4(4), pages 17-42.
    19. Philip Völlers & Thomas Neise & Philip Verfürth & Martin Franz & Felix Bücken & Kim Philip Schumacher, 2023. "Revisiting risk in the Global Production Network approach 2.0 - Towards a performative risk narrative perspective," Environment and Planning A, , vol. 55(8), pages 1838-1858, November.
    20. Tan, Man & Yang, Dengyu & Yang, Qijing, 2023. "Institutional quality, asset specificity, and foreign direct investment," Journal of International Money and Finance, Elsevier, vol. 134(C).
    21. Guo, Yue & Yang, Yu & Wang, Chang, 2021. "Global energy networks: Geographies of mergers and acquisitions of worldwide oil companies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 139(C).

    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:spr:apjors:v:9:y:2025:i:1:d:10.1007_s41685-024-00360-8. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.