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MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group Investment Patterns in ASEAN MIGA FDI Study Findings and Lessons Learned Presented by Bill Luttrell - MIGA MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group 1400 Total Global FDI 1200 Foreign Direct Investment 1000 800 Total M&A 600 400 Total Developing Countries 200 Total Asia (less Aus,NZ,Japan) 2001 World Investment Report - UNCTAD 2001 2000 1999 1998 1997 1996 0 1995 Total ASEAN MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group MIGA – Deloitte & Touche FDI Survey • Key business objectives behind FDI decision • Most attractive destinations for FDI • Key factors and considerations that influence strategy MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group Most Important Objectives When Investing Outside of Home Country Develop new product lines 4% Source Raw Materials 6% Other factors 8% Develop new technologies 2% Reduce operating cost 17% Reduce risk 1% 4% Consolidate operations 2% Improved productivity 1% Improved labor force access 55% Improved market access MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group Top FDI Destinations 0% 10% 20% 30% 40% Poland Italy Singapore Czech Republic Chile Thailand India Japan Hungary Malaysia 60% 70% 66% United States China Brazil United Kingdom Mexico Germany Canada France Australia Spain 50% 40% 39 % 39 % 35% 35% 33% 32% 27% 27% 26% 24% 23% 23% 22% 21% 21% 20% 19% 19% Argentina 19 % Russia 19 % MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group Most Influential Site Selection Factors • Access to customers (77%) • Stable social and political environment (64%) • Ease of doing business (54%) MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group Investment Plans • Postpone Project (47%) • Downsize Project (30%) • Go ahead with Project (20%) • Cancel Project (6%) MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group Lessons Learned … 10 suggestions for Sustainable Investment 1. Improve domestic demand 2. Strengthen AFTA / AIA / ASEAN-China Free Trade Area 3. Remove protectionist barriers 4. Provide better and standardized investment information 5. Pro-active marketing 6. Improve political and social environment 7. Improve transparency and reduce corruption 8. Improve education to match investor’s skill needs 9. Improve infrastructure and development of industrial clusters 10. Leverage domestic businesses through linkages to FDI MULTILATERAL INVESTMENT GUARANTEE AGENCY A Member of the World Bank Group Q&A MIGA / D&T FDI Survey: www.ipanet.net\fdisurvey