According to United Nation’s Economic and Social Commission for Asia and the Pacific, Asia-Pacific has become the world’s most popular destination for foreign direct investment, taking in almost half of all spending globally in 2018.
With China being perceived by some investors to be losing its competitive edge due to increased labour cost and a stronger currency, foreign investment within Asia-Pacific has shifted to south-east Asian countries such as Vietnam, Indonesia and Thailand, which offer lower production cost and improved labour productivity.
In particular, Singapore has become the top destination for regional companies setting up headquarters and has begun to attract more FDI into its financial services sector.
Caroline pointed out that pragmatic regulation, especially on fund management and venture capital, has contributed to Singapore’s growth as a key investment hub across the south-east Asia region.
On the other hand, China – top source of foreign direct investment (FDI) within the region after Japan – has become an important investor into the rest of the region, accounting for nearly 20% of intraregional investment.
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