Foreign Investment Research Articles

주식시장 수익률과 개인 투자자의 매매 성향

This study examines the relationship between individual investors and the KOSPI stock market using long-term data spanning 25 years from 1999 to 2023. However, this study analyzes the relationship between individual investors' net buys and KOSPI returns by dividing the entire period into five sun-periods of five years and applying two-sided regression and structural vector autoregressive (SVAR) models. The main findings are as follows: First, compared to foreign investors, both institutional and individual investors exhibit relatively higher turnover ratios. Second, cross-sectional analysis shows that KOSPI returns decrease monotonically with the individuals' net buys. Third, the results of the two-sided regressions indicate a Granger causality, where past returns negatively influence individual investors' net buys. In addition, today's individual net buys negatively Granger cause future returns. Fourth, the SVAR analysis also shows that KOSPI returns have a strong negative effect on individual net buys. Finally, according to the results of SVAR impulse response function, net buys response negatively to KOSPI shocks, and this response dissipates almost entirely by the third day. In summary, individual investors tend to engage in net selling in response to positive news in the KOSPI market, and this tendency may be a key reason for their lower performance.

The Impact of FDI On Economic Growth: Evidence from Different Sectors and Economic Conditions

The objective of this study is to examine how the foreign direct investment (FDI) influence China's economic expansion and evaluate its diverse role in various sectors and economic circumstances. This study uses multiple regression panel data Fixed Effects models with the robust standard errors to investigate further the potential significant impacts of both FDI inflows and outflows on economic development in China. The study employs panel data from 29 provinces in China, spanning the period from 2003 to 2021 for its analysis. This study found that FDI inflow contribute significantly and positively on growth in three different sectors, while outflow of FDI shows insignificant but positively correlated with growth. The results of coefficients reveal that FDI inflow in secondary sector has the strongest impact on growth, followed by primary and tertiary sector. Additionally, by including crisis in the models, the positive and significant impact of FDI inflow remain unchanged with the domestic investment became significantly and positively affect the economic growth. Hence, this study recommends the policy makers to promote and encourage more foreign investors to invest in China by giving some incentives such as reduction in capital gains taxes and more subsidies to the domestic firms especially in secondary sector.

The Power of Innovation: Entrepreneurship Ecosystem, Components, Research and Start-Up Approaches and the Development Process of the Entrepreneurship Ecosystem in Turkey

This article, under the title "The Power of Innovation: Entrepreneurship Ecosystem, Components, Research and Start-up Approaches and the Development Process of the Entrepreneurship Ecosystem in Turkey", examines how Turkey's dynamic entrepreneurship environment is shaped by innovation and the important components in this process. While entrepreneurship has a critical role in economic development and social transformation, innovation stands out as the main driving force of this process. First of all, Turkey's young and educated population, increasing digitalization and access to technology strengthen the entrepreneurial culture and create new business opportunities. In the article, the basic elements of the innovation ecosystem in Turkey, namely the interactions between universities, public institutions, the private sector and entrepreneurs, are discussed in detail. Additionally, the difficulties faced by entrepreneurs in Turkey are analyzed through factors such as limited financial resources, inadequate mentoring and training opportunities. In this context, the effects of the state's innovation strategies, incentive mechanisms and entrepreneurship support programs are examined. For example, the contributions of the supports provided by organizations such as KOSGEB and TÜBİTAK to the realization of entrepreneurs' projects are emphasized. In the article, the contribution of international collaborations and foreign investments to Turkey's innovation ecosystem is discussed, thus focusing on its competitiveness potential in the global market. Additionally, successful domestic enterprise examples are supported by concrete data showing how innovation and entrepreneurship create synergy. As a result, the development of the entrepreneurship ecosystem in Turkey is directly linked to the power of innovation. In order to create a sustainable innovation environment, the need for continuous support, training and policy development comes to the fore. This article aims to provide readers with a comprehensive perspective by presenting the paths and strategies to be followed to maximize Turkey's entrepreneurial potential.

Effects of foreign direct investment on climate change in the Asian region

Purpose ― This research aims to empirically investigate and compare the effects of foreign direct investment on climate change in five South Asian nations.Methodology ― This research uses yearly data covering 1980–2020 in five South Asian nations: Bangladesh, India, Nepal, Pakistan, and Sri Lanka. Vector Autoregressive (VAR) methods with variance decomposition and impulse response function provide the basis of the empirical data for comparison analysis. Findings ― This research shows that foreign direct investment's impact on pollution ranges from 1% to 10% in four countries and 16.13% in Pakistan. This indicates that in five South Asian states, there is little endogenous correlation between foreign direct investment and pollution. Furthermore, a shock to foreign investment improves the environmental conditions in Bangladesh and India while harming the growth of other nations.Implications ― The impact of foreign direct investment on pollution may vary based on each country's economic situation. Public efforts to enhance capital goods, education, health, and infrastructure are essential for reducing pollution and attracting foreign investment. Therefore, improved transparency and governance are essential for a positive relationship between growth and foreign investment.Value/Originality ― This research contributes to analyzing and comparing the effects of foreign direct investment on climate change in five South Asian nations using Vector Autoregressive (VAR) methods.

Compliance with anti-money laundering laws and their impact on banking operations in Pakistan: banking expert’s opinion

Purpose Despite sound anti-money laundering (AML) regulations and membership in the financial action task force, money laundering remains a severe concern faced by Pakistan because of its weak AML regime. This led to an investigation of the perceptions of banking expert’s regarding the AML law’s costs and complexity, mapping of compliance cost and measures taken by Pakistani banks in compliance with AML laws. Design/methodology/approach A socio-legal study approach was adopted based on library-based, and interviews using social media platforms to treasure the experts’ opinions regarding the impact of AML laws on baking operations in Pakistan. A semistructured interview-based questionnaire was handed out to Pakistani banking officers. Findings The findings revealed that, for banks to meet the AML obligation, they must overcome challenges including cost and complexity. Nevertheless, these costs are less expensive than the penalties assessed for noncompliance. Practical implications Following AML regulations can help the banking industry grow, which, in turn, attracts more foreign investment by boosting consumer confidence. However, it is difficult and expensive to comply with these requirements. The current research hopes that the financial regulatory authorities of Pakistan will adopt more effective measures for efficient compliance with AML laws. Originality/value The impact of compliance with AML laws on banking operations in Pakistan was examined in this study for the first time using banking officers’ opinions from various banks best of author’s knowledge.

Canada’s Green Strategy as a Factor in Countering Global Challenges

Canada, like many other countries, is increasingly focusing on transition to a green economy, realizing the problems associated with climate change, carbon emissions and the growing need for energy conservation. Canada is a large country with huge resources and potential for the development of a green economy. The Canadian approach to implementing a green strategy based on clean technologies and best production methods is comprehensively explored. Key government policies and programs to stimulate the development of green sectors of the economy, reduce greenhouse gas emissions and combat climate change are analyzed. The main projects and initiatives aiming to accelerate the transition to renewable energy sources and increase the level of energy efficiency, as well as measures to stimulate environmental consumption among the population and attract foreign investment in the field of green economy, were studied. The role of provinces, territories and municipalities in the development of a green economy are also discussed.

Risk and Benefit Analysis of China’s Foreign Direct Investment in the Energy Sector: Case Study of the Belt and Road Initiative

Since 2011, China has been the world's largest energy consumer. The industrial sector uses two-thirds of the energy consumed in China. The main reason for investment in energy is that China is a net importer of energy, especially oil. The impact of Chinese foreign investments and the energy sector, which is the largest of the individual sectors, are the main subjects of the analysis of the presented paper. In the paper, we used the WoS viewer program to perform a bibliometric analysis of authors, countries, and keywords that deal with FDI. Subsequently, we used various scientific methods, such as the method of observation, method analysis, synthesis, comparison, exploration and explanation, to analyse Chinese investments that flow into multiple sectors worldwide, but especially into the countries participating in the Belt and Road Initiative and into the energy sector from 2013 to the present. As part of the Belt and Road Initiative, China invests in various projects in the form of "loans" and, in many cases, creates debt traps that allow China to seize the assets of participating countries. In this paper, we focused on the energy sector and its development so far within the given initiative, and we also defined what the initiative should focus on within renewable resources. China's energy investments include oil, hydropower, alternative energy, natural gas, and coal. The sharp drop in Chinese investment after 2019 was caused by the COVID-19 pandemic. To conclude, although energy has remained China's primary sector for investment within the BRI regions, Chinese capital has gradually diversified into sectors such as transportation, real estate, technology and innovation, and tourism.

The Efficiency of Procurement Process, Organization Performance, and Product Training in Public Organization

The manufacturing sector is considered a key driver of economic progress across different sectors. Industrial products typically enjoy higher "terms of trade," making them more profitable and generating greater added value compared to products from other sectors. This is due to the sector’s diverse range of products and its ability to offer substantial marginal benefits to users. As a result, business players including manufacturers, distributors, traders, and investors are more inclined to participate in this sector because of its attractive profit margins. The government has implemented various initiatives to promote industrial development, which has in turn increased the demand for funding to support this growth, particularly in the industrial sector. In addition to relying on internal sources of finance, the government has been working to secure more external funding, such as foreign investment and foreign loans, to complement development efforts. Given the limited availability of funds, the government needs to adopt policies that open up more opportunities for both domestic and foreign private sector participation in national development. To support this, the government has enacted legislation such as Law No. 1 of 1967 on Foreign Investment (PMA) and Law No. 6 of 1968 on Domestic Investment (PMDN). These laws were later refined through Law No. 11 and Law No. 12 of 1970 and various deregulation policies, including the May 6, 1986 Package, Pakto 1993, and Government Regulation No. 20 of 1994. The government later reorganized its investment policies by passing Law No. 25 of 2007 concerning Capital Investment, which aimed to provide legal certainty, protection, and simplified licensing processes for both domestic and foreign investors. This law is designed to create a more favorable investment environment in Indonesia.

Methodological insights regarding the impact of COVID-19 dataset on stock market performance in African countries: A computational analysis

This research aims to evaluate the impact of the COVID-19 pandemic on stock markets in Africa. The study analyzes the stock market returns in nine selected African countries (South Africa, Morocco, Tunisia, Botswana, Nigeria, Uganda, Kenya, Mauritius, and Tanzania) before, during, and after the COVID-19 pandemic. We investigate the impact of COVID-19 on stock market returns and the effect of the worst-hit country's volatility on other African countries' stock market returns utilizing autoregressive conditional heteroscedasticity (ARCH), generalized ARCH (GARCH), and threshold ARCH (TARCH) tests. Additionally, we explore the implications for foreign investors in terms of portfolio diversification and risk management, contributing to the existing literature on the effects of the COVID-19 crisis on financial markets and investment risk. Thereby, we provide insights into African stock markets' interconnectedness and help foreign investors reduce their losses and manage risks associated with the COVID-19 pandemic. Finally, we discuss the need for further research.

Constitucionalismo transformador y derecho internacional de inversionesTransformative constitutionalism and international investment law

Abstract International investment law faces five core legitimacy challenges: the state-dependency challenge, the human and constitutional rights challenge, the equality challenge, the standard of protection challenge, and the investor state dispute settlement system challenge. This article endorses the claim that constitutional courts can contribute to the solution of those legitimacy challenges when they exercise the power to review the constitutionality of international investment treaties. From a transformative perspective, constitutional courts of host states can: (i) create public deliberation and raise awareness concerning the legitimacy challenges of international investment law; (ii) grant equal treatment to national and foreign investors; (iii) require governments to negotiate less open-textured provisions in international investment treaties; (iv) safeguard the protection of human and constitutional rights, and other common goods; and (v) raise due process, predictability, transparency, and proportionality standards concerning the investor state dispute settlement system. These judicial undertakings can strengthen the bargaining power of host executive branch authorities in the negotiation of international investment treaties and can narrow down the space of discretion of international investment arbitral tribunals. Both outcomes could render international investment treatises’ creation and enforcement more legitimate.

Foreign Direct Investment and Its Effect on Agricultural Productivity Kenya

Kenya has historically been one of Africa's top destinations for foreign direct investment. Foreign direct investment is critical for Kenya's agricultural sector, offering capital, technology transfer, and skill development that enhance productivity and economic growth. Despite agriculture being a primary economic driver, challenges such as limited capital, outdated farming techniques, and insufficient infrastructure continue to hinder growth. The research explores the contribution of foreign direct investment on agricultural productivity in Kenya as well as to assess the effect of foreign direct investment on the productivity levels of small-scale and large-scale farmers in Kenya for a period 1993 to 2022. Neoclassical growth theory, Endogenous theory were key in guiding the study. This study adapted the causal research design employing time series data from World Bank spanning from years 1993 to 2022. Data was analyzed the data both descriptively and by inferential statistics. The findings of correlational analysis revealed a moderate positive relationships (r= 0.3213) between Foreign direct investment and agricultural productivity. Multiple regression analysis confirmed the significant positive effect of foreign direct investment on agricultural productivity with a coefficient of 0.3661 and p value 0.0014<0.05. This signifies that, in the short term, a 1% increase in foreign direct investment results in a 36.61% rise in the growth of Agricultural productivity, assuming all other variables remain constant. The findings implied that foreign direct investment inflow has the ability to create employment, technological development and improve access to international markets playing a pivotal role in accelerating the agricultural productivity. The Kenyan government should have more effective foreign direct investment strategies to facilitate technology transfer agreements between foreign investors and local agricultural enterprises, additionally, the government should pursue macroeconomic policies that attract foreign direct investment by providing an investor-friendly environment.

Analysis of Exchange Rate Stability on the Economic Growth Process of a Developing Country: The Case of South Africa from 2000 to 2023

This study examines the impact of exchange rate stability on the economic growth of South Africa from 2000 to 2023, a period characterised by significant political and economic changes. Exchange rate stability is critical for developing countries, affecting key macroeconomic variables such as trade balances, foreign direct investment (FDI), and inflation. For emerging economies like South Africa, maintaining a stable exchange rate can reduce uncertainty in international transactions, foster investor confidence, and support sustainable economic development. This research explores whether consistent exchange rate management has positively influenced South Africa’s economic trajectory, particularly by mitigating the adverse effects of global shocks and domestic volatility. Using the EasyData online database, which contains yearly time series data, the method of analysis adopted by the research is the ordinary least squares (OLS) regression method. The findings show that while exchange rate stability positively impacts GDP, the influence of FDI and political risk is more substantial. These results underscore the importance of fostering a stable economic environment through sound exchange rate policies, political stability, and efforts to attract foreign investments to ensure long-term economic growth.

Indicators of Attracting Foreign Direct Investment in Developing Countries: Evidence from Vietnam

In today’s global economy, whether in advanced or emerging markets, the importance of being open to trade and investment is widely acknowledged as a key driver of economic growth. This economic openness is primarily demonstrated through the unrestricted exchange of goods and services as well as the free movement of international capital. While previous studies have investigated the effects of export-driven, import-driven, and capital-driven growth strategies, this research focuses on analyzing the impact of each indicator of the Provincial Competitiveness Index (PCI) on attracting foreign direct investment (FDI). By utilizing a panel data model covering 63 provinces and cities in Vietnam from 2018 to 2022, this study explores the correlation between PCI, FDI, and economic expansion. Findings suggest that export-oriented growth policies can be more effective in fostering the development of Asian emerging economies than FDI-centric approaches. Nonetheless, FDI continues to be crucial for technology transfer, capital accumulation, and knowledge exchange in management. Regions with advanced economies are more appealing to FDI, while provinces with distinctive industrial strengths also attract foreign investment. To further boost FDI inflows, it is advised that the government streamline market entry procedures, reduce administrative and tax burdens, increase transparency, and promote fair competition. These measures are anticipated to improve the investment climate and enhance competitiveness on the global stage.

Carbon dynamics: A holistic analysis of FDI, trade liberalization, urbanization, economic growth, and effects on CO2 emissions in South Asia

In recent years, South Asian nations have experienced robust economic growth, prompting concerns among policymakers about the sustainability of this growth due to rising pollution emissions. This study conducts an objective assessment of the impact of key variables, such as trade liberalization, economic growth, foreign direct investment inflows, and urbanization, on environmental outcomes across selected economies of South Asia from 1990 to 2022. To describe cross-sectional dependencies in the dataset, panel cointegration techniques are employed alongside cross-sectionally augmented autoregressive distributed lag (CS-ARDL) models. For added robustness, dynamic ordinary least squares (DOLS) and fully modified ordinary least squares (FMOLS) techniques are utilized to investigate the long-term coalition among the variables. The study integrates first- and second-generation panel methods to improve the depth and reliability of the analysis by addressing methodological limitations. The pragmatic results reveal that trade liberalization, FDI inflows, economic growth, and urbanization increase CO2 emissions by 0.392%, 0.354%, 0.275%, and 0.429%, respectively. Dumitrescu and Hurlin (D–H) causality tests show a unidirectional causal link from trade liberalization to environmental degradation. Additionally, a bidirectional causal link is observed between environmental deterioration and both FDI inflows and urbanization in South Asian countries. To mitigate environmental impact, these nations should evaluate foreign investment conditions and enhance technology transfer from foreign enterprises. Furthermore, implementing trade-related policies to reduce CO2 emissions is imperative.

A Legal Examination of Stabilization Clauses in Petroleum Contracts in Cameroon

This study aims to explore the legal examination of stabilization clauses in petroleum contracts in Cameroon. Stabilization clauses forms one of the pillars in protecting the interest of foreign investors in petroleum contractual arrangements. These clauses act as a shield to investors as they protect oil companies from the modification attempts in the agreement by host countries by subsequent legislative changes. Their legal validity in the Cameroonian petroleum industry has been guaranteed by the Petroleum Law of the country. However, the findings of this research reveals that the applicability of these clauses remains questionable as the Cameroonian government can implement nationalization and expropriation based on public utility, security or national interest, with suitable compensation. Furthermore, the Cameroonian government can introduce new legislative or regulatory changes in the petroleum contracts, the terms of which must be agreed by both sides and if an agreement is not reached, the matter can be resolved through arbitration.

The Identification and Regulation of Expropriation in International Investment Law

This essay focuses on the concept of expropriation within the framework of international investment law. Expropriation has evolved from direct state appropriation of foreign investors’ property to indirect expropriation, a more covert measure without the transfer of ownership. This essay distinguishes between direct and indirect expropriation, explores the meaning of expropriation through key cases, and evaluates the challenges tribunals face in legal practices. Finally, this essay examines the role of fair and equitable treatment (FET) standards and compensation mechanisms. With an effective regulation of expropriation, the author believes that a balance between state sovereignty and investor protection can be achieved.

China’s Coffee Frontier: A Tale of Two Regions and a Global Market

This essay explores the evolution of China’s coffee industry, focusing on two key regions—Yunnan and Hainan. Despite coffee’s late introduction to China compared to tea, Yunnan has become a dominant player, producing 98% of the nation’s coffee, largely Arabica. The region’s mountainous terrain and favorable climate have propelled its coffee industry, which has seen substantial foreign investment and efforts to enhance coffee quality. In contrast, Hainan’s tropical conditions make it ideal for Robusta production, though its cultural coffee practices, influenced by Southeast Asian migrants, set it apart. The essay also examines how the growing demand for coffee, spurred by urbanization and lifestyle changes, has shifted Chinese consumption patterns. Companies like Luckin Coffee and Starbucks have capitalized on this trend, contributing to both the domestic and global coffee markets. Despite rapid growth, China still represents a small share of global coffee production, but its coffee culture and industry are poised for further expansion. The synergy between rising specialty coffee demand and advancements in delivery services suggests continued growth for China’s coffee market on the world stage.

The Impact of the China-US Trade Friction on Vietnam’s Chip Industry

The impact of the China-US trade friction on the world has received widespread attention, but there is still insufficient focus on the Vietnamese chip industry. This article analyzes the impact of China-US trade on Vietnam and the background, development, challenges, and measures of Vietnam’s chip industry. This article argues that the China-US trade friction has brought development opportunities to Vietnam’s semiconductor industry. Many semiconductor companies have chosen to open factories and expand production in Vietnam, and Vietnam’s semiconductor market has also expanded. However, Vietnam has problems such as inadequate infrastructure, a weak technological foundation, government policies that are not suitable for foreign investment, and a lack of human resources. Based on this, this article proposes the following suggestions: Vietnam needs to actively seek cooperation with major countries, the government needs to play a coordinating and important investor role, Vietnam needs to strengthen infrastructure construction, Vietnam needs to promote technological innovation, and Vietnam needs to strengthen the training of high-end talents.

DETERMINASI KETIMPANGAN PENDAPATAN WILAYAH PERKOTAAN DAN PERDESAAN DI INDONESIATAHUN 2019 – 2023

This study aims to examine the effect of economic growth, foreign investment, and human development index on the income inequality in urban and rural areas in Indonesia. This study uses three independent variables economic growth, foreign investment, and human development index. The dependent variable of interest is the Gini Ratio. This study uses data from the period 2019 to 2023 with the panel data regression method. The results showed that aspects of community welfare, namely Average Per Capita Expenditure and Life Expectancy, had a significant effect according to the hypothesis on Inclusive Economic Growth in Indonesia. The variables that have a statistically significant effect according to the hypothesis is the human development index in rural areas. Meanwhile, the economic growth is not by the proposed hypothesis in urban & rural areas because the rate of economic growth is not received evenly or shows a trickling up effect so that it is only felt by a certain group of people.

STUDY OF TRIPLE BOTTOM LINE FRAMEWORK TO DETERMINE THE OFDI PATTERN OF VIETNAM

This study investigates Vietnam’s Outward Foreign Direct Investment (OFDI) spanning from 1990 to 2022, utilizing the Triple Bottom Line (TBL) framework alongside the Fully Modified Ordinary Least Squares technique. The observed positive correlation between CO2 emissions and foreign investment underscores the importance of corporate sustainability. Vietnam’s extensive forested land, comprising 41.89% of its total area, emerges as a pivotal factor in attracting environmentally conscious investors. On the social front, the population size demonstrates a negative impact on OFDI due to heightened competition within the domestic labor market. Regarding economic variables, the Consumer Price Index and patent applications exhibit minimal effects, whereas a growing Gross Domestic Product (GDP) substantially boosts foreign investments. The proposed practical policies for promoting OFDI include reinforcing environmental regulations, incentivizing the adoption of eco-friendly technologies and prioritizing the conservation of forested areas.