Foreign Direct Investment (FDI) Environments of the 21 Provinces of Mongolia and Implications for FDI in the Provinces

Abstract

Lately, foreign investors have become interested in making direct investment in the Mongolian provinces. One thing that is becoming important given that foreign investors have become interested in making direct investment in the Mongolian provinces in this manner is a study on examining FDI environment of the Mongolian provinces and deriving implications for FDI in the Mongolian provinces based on it. The reason is that, first, this type of study could be significant for foreign investors’ selection of a province to make a direct investment among the Mongolian provinces and second, for that foreign investors develop a way and strategy to make a direct investment in the Mongolian provinces. Furthermore, this type of study could be significant in helping direct investment of foreign investors in the Mongolian provinces be conducted rationally and effectively, through, for instance, the above two ways. To the best of the author‘s knowledge, there has been no study on FDI environments of the 21 provinces of Mongolia and implications related to making direct investment therein. However, considering foreign investors’ growing interest in direct investments in the Mongolian provinces and significance of study on the FDI environment of the Mongolian provinces and implications for FDI based on it, it seems that this type of study is essential. Accordingly, the study aims at examining FDI environments of the 21 provinces of Mongolia and developing implications related to that foreign investors make a direct investment in the Mongolian provinces based on it. In line with this aim, the study, first, developed a theoretical framework to examine FDI environments of the 21 provinces of Mongolia from the perspective of main types of FDI such as market-seeking, resources-seeking, and efficiency-seeking FDI. Thus, it examined FDI environments of the 21 provinces of Mongolia by applying the theoretical framework and derived implications related to foreign investors making FDI in the Mongolian provinces based thereon. The study yielded the following results. First, it found that the 21 provinces of Mongolia have different and distinct environment by each FDI type (market-seeking, resources-seeking, and efficiency-seeking FDI). In addition, it found that there are provinces that have a favorable environment and provinces that have a semi-favorable environment by each FDI type. Second, it derived and suggested five implications related to foreign investors making FDI in the Mongolian provinces based on the FDI environments of the 21 provinces of Mongolia. Finally, the study reached a conclusion that foreign investors are able to make FDI in the Mongolian provinces in several ways related to the FDI environments of the 21 provinces of Mongolia.