Foreign direct investment (FDI) in South-East Asia's manufacturing sector grew nearly 150% to US$30.8bil in the first half from a year earlier as the region gained from a runoff in investor interest in China and India.
"There is tremendous draw of the Chinese and Indian economies," Asean secretary-general Ong Keng Yong told reporters yesterday.
Ong, in Manila for a meeting of South-East Asian economic ministers, said many foreign investors passed through South-East Asia when travelling to look at potential investments in China and India and end up investing in the region.
Total FDIs into South-East Asia rose 9% to US$15bil in the first quarter of 2007 from a year earlier. With 567 million people, the region has a population bigger than the European Union.
China attracted US$15.9bil in FDIs in the same period, an 11% increase from the first quarter of 2006.
Wary of being left trailing in China and India's wake, Asean wants to create a European Union-style economic community by 2015. Economic ministers will agree this weekend on the blueprint for creating the community.
South-East Asian countries had previously agreed to remove duties on 3,523 tariff lines starting in January this year and drop non-tariff barriers in the region in three phases starting in 2008.
The region attracted total FDIs of US$52.4bil in 2006, up 28% from 2005.
The top five manufacturing sectors for FDI in 2006 were radio, television and communication equipment; chemicals and chemical products; basic metals; machinery and equipment; and non-metallic mineral products. – Reuters
The Star, August 24, 2007