Facebook:@ www.facebook.com/ S Á C H – T À I L I Ệ U T H I T U Y Ể N Trang 1 GRADUATION THESIS Major: International Business Economics DETERMINANTS OF FOREIGN DIRECT INVESTMENT FROM JAPAN INTO SOUTH EAST ASIAN COUNTRIES AND RECOMMENDATIONS FOR VIETNAM Facebook:@ www.facebook.com/ S Á C H – T À I L I Ệ U T H I T U Y Ể N Trang 2 TABLE OF CONTENTS ABBREVIATIONS LIST OF FIGURES AND TABLES INTRODUCTION.................................................................................................. 1 CHAPTER 1: OVERVIEW OF FOREIGN DIRECT INVESTMENT AND JAPAN FOREIGN DIRECT INVESTMENT OUTFLOWS ............................ 3 1.1 Overview of Foreign Direct Investment......................................................... 3 1.1.1 Concepts.......................................................................................................... 3 1.1.2 Characteristics................................................................................................. 4 1.1.3 Classification................................................................................................... 5 1.1.4 Determinants of FDI ....................................................................................... 10 1.1.5 Role of FDI towards home and host countries................................................ 16 1.2 Overview of Japan Foreign Direct Investment Outflows............................. 20 1.2.1 Total value and number of projects of Japan outward FDI ............................ 20 1.2.2 Japan FDI outflows by region......................................................................... 23 CHAPTER 2: DETERMINANTS OF JAPAN OUTWARD FOREIGN DIRECT INVESTMENT TO SOUTH EAST ASIAN COUNTRIES............... 31 2.1 Overview of Japan FDI outflows to South East Asian countries................. 31 2.1.1 Japan FDI outflows to the whole South East Asian countries as a unit.......... 31 2.1.2 Japan FDI outflows to individual South East Asian countries ....................... 36 2.2 Literature review of empirical research about determinants of outward foreign direct investment....................................................................................... 43 2.3 Quantitative analysis about determinants of Japanese outward FDI to South East Asian countries.................................................................................... 48 2.3.1 Methodology and model specification............................................................ 48 2.3.2 Data and variable description.......................................................................... 49 2.3.3 Result analysis................................................................................................. 54 CHAPTER 3: RECOMMENDATIONS TO VIETNAM ON ATTRACTING FOREIGN DIRECT INVESTMENT FROM JAPAN ....................................... 60 3.1 Situation of attracting Japan outward FDI to Vietnam............................... 60 Facebook:@ www.facebook.com/ S Á C H – T À I L I Ệ U T H I T U Y Ể N Trang 3 3.1.1 Total value of Japan FDI to Vietnam.............................................................. 60 3.1.2 Japan outward FDI to Vietnam by sector........................................................ 61 3.2 Governmental directions and targets to boost Japan FDI........................... 62 3.3 Recommendations for Vietnam to attract Japan outward FDI................... 63 3.3.1 Enhancing national economic growth............................................................. 63 3.3.2 Improving the quantity and quality of human capital..................................... 65 3.3.3 Upgrading quality of infrastructure................................................................. 67 3.3.4 Boosting exchange rate policy ........................................................................ 69 3.3.5 Boosting trade openness by conducting promotion schemes ......................... 69 CONCLUSION.........................................................................................