Abstract
Asia is a heterogeneous region including countries with distinct features in quite a few facets. This study is designed to unravel the motivations of Chinese FDI in 30 Asian countries (For list of countries see Appendix 1.) during 2003–2016. For estimation, we utilised the Random effect (RE), Fixed effect (FE) and System-GMM (SGMM) methodologies. We transpired that both market and natural resource (mineral richness) seeking motives of Chinese FDI in the whole sample analysis. With respect to income group, we confirmed the market seeking FDI in both high and middle-income countries whereas, mineral richness is priority for Chinese FDI in middle-income group. Thus, Chinese firms targeted middle income developing economies to acquire non-fuel natural resources. Analogously, on the regional basis, the results show that in all regression models, GDP is positive and significant predictor, characterising market seeking FDI by Chinese firms in West, East and South East Asia. In resource seeking motive, among the two types of natural resources, mineral richness affect Chinese FDI positively in East & South East Asia. In a nutshell, seeking market is the common motive for Chinese FDI in the entire sample, whereas the resource seeking motive varies across the income groups and regions.
Highlights
One of the salient features of globalisation is the internationalisation of business
The correlation matrix depicts the significant relationship between some variables, none of such correlation is high enough to cause the problem of multicollinearity
The results indicate that the t-statistics associated with all variables are significant both at levels and first difference
Summary
One of the salient features of globalisation is the internationalisation of business. Internationalisation can occur in certain forms such as export, licencing, franchising and foreign direct investment (Aleksandruk & Forte, 2016). The surge in outward foreign direct investment (OFDI) by emerging economies is a major trend and well documented in the literature China’s Outward Foreign Direct Investment (OFDI) has experienced significant growth since its entry into the World Trade Organization in 2001. While on the basis of flows, China’s OFDI has shown an upward surge from 10% of total developing countries OFDI in 2004 to 49% in 2015. Asia has attracted a lion’s share of $108.37 billion of total China’s OFDI flows
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
