More MNCs may come to Asia

More MNCs may come to Asia

UNITED NATIONS (AFP): Developing Asian countries are expected to be the most likely investment destination for multinational companies in the next five years, according to a report published here Monday.

The survey "International Investment: Towards the year 2001," whose conclusions were outlined here by French government expert Fabrice Hatem, was compiled in cooperation with the UN Conference on Trade and Development (UNCTAD).

It was based on responses from more than 310 transnational corporations and international experts.

According to the report, while increased investment has mainly benefited the seven Association of South East Asian Nations (ASEAN) countries and China, "in a few years it could spread to countries such as India and Vietnam where conditions for foreign investment are improving rapidly."

ASEAN comprises Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

"Huge markets and prospects for rapid growth in demand are clearly appealing, while at the same time the perceived level of risk is declining and rules for foreign direct investment are taking a more favorable turn," the report said.

The survey noted that European and U.S. companies would hold investment in their home region "while massively increasing that in developing economies, especially in Asia."

"In contrast, Asian companies will significantly increase investments in the US, Western and Eastern Europe, but will focus most of their additional efforts on their home region."

The report said that the Asian companies, by so doing would "make up for earlier lags."