Investment in ASEAN up by 131 percent in 1994

Investment in ASEAN up by 131 percent in 1994

KUALA LUMPUR (AFP): Foreign investment into ASEAN jumped by 131 percent to US$39.5 billion last year from $17.1 billion in 1993, with Indonesia absorbing the bulk of the increase, Malaysian trade authorities said yesterday.

Better political and economic stability and the continuing liberalization of ASEAN economies combined with abundant natural resources helped pull in the investments, Malaysia's international trade and industry ministry reported.

Indonesia topped the list in the Association of Southeast Asian Nations (ASEAN), which groups it with Malaysia, Singapore, Thailand, Brunei and the Philippines, with investment inflow in 1994 almost tripling to $23.7 billion from $8.1 billion previously.

The surge was partly due to the approval of six giant projects worth more than $1 billion each, the ministry report said.

Foreign direct investment (FDI) in the Philippines jumped by 326 percent to $2.45 billion from $574 million, while in Thailand, the inflow was higher by 39.5 percent to $5.95 billion from $4.26 billion.

Proposed foreign investments in Malaysia grew by 78.5 percent to $4.4 billion from $2.47 billion, which officials attributed mainly to ongoing investment by existing companies.

In comparison, Singapore's FDI growth last year was slightly less steep, up 54.1 percent to $2.96 billion from $1.92 billion previously.

The largest investment source was Hong Kong, which pumped $6.90 billion into ASEAN countries last year, closely followed by Japan with $5.56 billion and the United States with $5.19 billion.

Both Hong Kong and Japan invested most heavily in Indonesia, in projects which included a massive petroleum refinery and two power supply schemes.

Economists said the strong yen would continue to prompt more Japanese multi-national corporations to invest in alternative manufacturing bases in ASEAN countries.

Investments among ASEAN countries also increased last year, growing 49 percent to $3.3 billion. Singapore was the prime source of intra-ASEAN investments, pouring $2.5 billion into other ASEAN members.