Foreign Direct Investment and Corruption Perseption Index in Asean-5 Countries

Abstract

This study's goal is to examine the connection between foreign direct investment (FDI) and Corruption Perception Index (CPI) in ASEAN-5 including the Philippines, Indonesia, Malaysia, Thailand, and Vietnam, during the period 2001-2019. Furthermore, we examine the link between FDI and macroeconomics variables, such as Gross Domestic Product (GDP) and Interest Rates. Panel data with a fixed effect model (FEM) are used in this investigation to examine the relationship between variables. The findings of this investigation suggest that the corruption perception index and gross domestic product have an impact on foreign direct investment that is both positive and significant. Meanwhile, foreign direct investment is significantly and negatively impacted by interest rates.