2024-2025年亞太地區(qū)外國直接投資趨勢與展望 ASIA-PACIFICTRADE AND INVESTMIENT TRENDS 2024 -2025 Foreign DirectInvestment

ASIA-PACIFICTRADEANDINVESTMENT

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/2025ii

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/2025iii

Acknowledgements

ThisBriefwaswrittenbyTomBeckerandKynanKing,intheInnovation,Enterprise,andInvestmentSection(IEIS)oftheTrade,InvestmentandInnovationDivision(TIID),intheUnitedNationsEconomicandSocialCommissionforAsia-Pacific(ESCAP).

ThedevelopmentoftheBriefwascarriedoutunderthesubstantivedirectionofHeatherTaylor-Strauss,andoveralldirectionofRupaChanda,Director,TIID;JonathanWong,Chief,IEIS,TIID;andYannDuval,Chief,TradePolicyandFacilitationSection(TPFS),TIID.ThecoverdesignwascreatedbyNucharatTuntiwigit.

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/2025iv

Contents

Highlights 1

1.Greenfieldinvestmenttrends, 2

2.SubregionalFDItrends 6

2.1EastandNorth-EastAsia 8

2.3SouthandSouth-WestAsia 10

2.4NorthandCentralAsia 12

2.5ThePacific 13

3.TrendsinintraregionalGreenfieldFDI 14

4.SectoraltrendsinGreenfieldFDI 16

5.Investmentdeterminants,motivationsand

evolvingbusinessesfunctions 19

6.ClimateFDITrends 21

7.Conclusion 27

References 29

Appendix1:ClimateMitigationandClimateAdaptationSectors 33

Appendix2:SelectSectorDefinitions(fDiMarkets) 34

ListofFiguresandTables

Figure1.AnnouncedGreenfieldFDIinflowsandoutflowsfromAsia-Pacific 4

Figure2.GreenfieldFDIInflowYTDSepgrowthratesinAsia-Pacific 6

Figure3.GreenfieldFDIOutflowYTDSepgrowthratesinAsia-Pacific 7

Figure4.IntraregionalInflowsofGreenfieldFDIinAsia-Pacific 14

Figure5.SectoralcompositionofannouncedGreenfieldinflowsinAsia-Pacific 16

Figure6.TopSectorsforgreenfieldFDI,2014-2023 18

Figure7.Toptenmotivescitedforprojects 19

Figure8.NumberofprojectsbybusinessactivitiesinAsia-Pacific 20

Figure9.ClimateAreasandCoal,Oil&GasGreenfieldFDI 23

Table1.SubsectorstargetedbyinvestorssupportingtheEVvaluechain 25

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20251

Highlights

ChangeinGreenfieldFDI

?In2024,totalGreenfieldFDIinflowstoAsiaandthePacificsawa14percentdecreasecomparedto2023drivenbySouth-EastAsiawhichdroppedby33percent.However,thisisasmalldipoverarecord2023showingtheregion’sstrength.

RegionalHighlight

?TheNorthandCentralAsiasubregionhasseenanotheryearofstronginvestmentgrowthin2024,withGreenfieldFDIinflowsincreasingby27percentyear-to-date.ThiswasdrivenprimarilybyKazakhstanthroughchemicalandnaturalgasrelatedprojects.However,SouthandSouth-westAsiahasattractedthemostGreenfieldFDIsofarin2024amountingtoUS$83billion.

CountryHighlight

?IndiaemergedagainasthetopdestinationforGreenfieldFDIinflowsinAsiaandthePacificin2024,attractinganestimatedUS$76billionthusfar.Investmentsinsemiconductorsandrenewableenergyledtheway.

ClimateFDIHighlight

?GreenfieldinvestmentsintoclimateFDIrepresented21percentoftotalinvestmentsintoAsiaandthePacificledbyinvestmentsintogreenhydrogenprojects.However,totalinvestmentsweredown15percentintheJanuary-Septemberperiodof2024,comparedto2023.

IndustryHighlight

?ThecommunicationsindustrysawsomeofthemostsignificantgrowthinGreenfieldFDIin2024,rising69percenttoUS$40billionplacingitasthesecondlargestsectorbehindrenewableenergyatUS$58billion.

SignalsHighlight

?InternationalinvestorsarechoosingAsiaandthePacificforitsinternalmarket,withthetoptwoprojectmotivesintheregionbeingproximitytomarketsorcustomeranddomesticmarketgrowth.

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20252

1.Greenfieldinvestmenttrends

1,

2

Thelandscapeofforeigndirectinvestment(FDI)inAsia-Pacificcontinuestoevolverapidlyamidglobaleconomicuncertainties,geopoliticalshifts,andtechnologicaltransformations.While2024haswitnessedsomemoderationininvestmentflowsfollowingtherecord-breakingannouncementsof2023,theregionhasdemonstratedremarkableresilienceandmaintaineditspositionasapremierdestinationforinternationalcapital.ThisBriefanalyzesthelatesttrendsinGreenfieldFDIacrossAsia-Pacific,examininghowchanginginvestormotivations,emergingsectors,andpolicydevelopmentsarereshapinginvestmentpatterns.SpecialattentionisgiventothegrowingsignificanceofClimateFDIanditspotentialtoadvancetheSustainableDevelopmentGoals(SDGs)whilecreatingneweconomicopportunities.

Thisevolvinginvestmentlandscapereflectsabroadertransformationinhowglobalinvestorsapproachopportunitiesandrisksinthepost-pandemicera.Theinitialreactiveresponsestorecentglobaldisruptionsaregivingwaytomoremeasured,strategicdecision-makingasmarketssettleintonewpatternsandpriorities.

Aftertheinitialimpetusandurgetoactioninresponsetorecentchallenges,investorsareadaptingtoa'newnormal

'3

whereevolvingparametersaffectingglobalmarketsandpoliticsareexpectedtopersist.KeyfactorsshapingthislandscapeincludeacceleratedinvestmentsinthedigitaleconomyfollowingCOVID-19,heightenedfocusonenergysecurity,strategicrestructuringofsupplychainsamidgeopoliticaltensions,andthewidespreadadoptionofindustrialpoliciesasstandardeconomictools.Twodistincttrendshaveemerged:first,investorsaretakingamoremeasuredapproachtoevaluatingopportunitiescomparedtotheinitialsurgeofreactiveinvestments;second,therehasbeenanaturalmoderationininvestmentpaceasprojectsannouncedin2023moveintoimplementationphase,withcorporateinvestorscloselymonitoringtheirperformanceandimpact.

Thisnewinvestmentparadigmreflectsaglobalcontextwhere"supplyconditions,talent,inflation,policyandgeopoliticalconsiderationsplayagreaterrole."

4

Companiesarerespondingtotheseeconomicpressuresbydisruptingtraditionalinvestmentpatterns,seekingnewmarketsforstabilityandopportunity,anddiversifyingtheiroperationalbaseswithinAsia-Pacific.TheseshiftsinglobalFDIflowsareleadingtotheemergence

1Allgreenfieldinvestmentdatainthisreportfor2024isbasedonthemostrecentGreenfieldFDIdataavailableatthetimeofwriting,whichwasfromJanuary-September2024.

2GreenfieldFDIreferstocapitalinvestments,typicallybycorporateinvestors,resultingincapitalinflowstoahostcountryoftheinvestmentandtheformationofnewassetstheinvestoraimstoactivelycontrolandoperate.Anexamplewouldbeamedicaldevicescompanyfromonecountryinvestinginanewmanufacturingplantinanothercountry.Seealso:

/content/video/explained-what-is-greenfield-fdi-83737

3See:

/practical-law-the-journal/transactional/geopolitical-outlook-investors-2024-2024-

03-01/

4See:

/content/dam/ey-unified-site/ey-com/en-us/insights/strategy/documents/ey-us-mid-

2024-global-economic-outlook-july-edition.pdf

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20253

ofnewhubsacrossdifferentsegmentsofvalueandsupplychains–locationsthatmuststillprovetheirlong-termviabilitytoinvestorsconductingregionalassessments.

“Afteraboomingyetturbulentandimpulsive2023forFDIinAsia-Pacific,investors

appeartohavebegunoperatingina‘newnormal’whereconsiderationsofgeopolitics,

supplychainsandpolicyinterventions–amongstotherthings–haveenteredthe

mainstreamatlast”

Inthiscontext,proactiveinvestmentpromotionbylineministriesandinvestmentpromotionagencies(IPAs)becomesincreasinglycrucial,particularlyinsectorscontributingtosustainabledevelopment.Foremerginginvestmentdestinations,successdependsnotonlyoncreatingtherightpolicyenvironmentbutalsoonofferinginvestorsacomprehensivesuiteofsupportservicesandaftercare.IPAsareplayinganincreasinglycriticalroleindirectingforeigninvestmenttowardsustainabledevelopmentinitiatives,particularlygivencurrentglobalchallenges.Whiletheenergycrisishasdrivensomeinvestmenttowardcarbon-intensiveprimarysectoractivities,thistrendisbeingcounterbalancedbygrowingFDIinclimateadaptationandmitigationprojects.ThisemergingshiftininvestmentpatternspresentsanopportunityforIPAstostrategicallychannelcapitaltowardsectorsthattangiblyadvancetheSDGs.

Infact,manyeconomiesacrossAsia-PacificcontinuetoreserveaprominentplaceforFDIattractiontoachievetheireconomicdevelopmentgoals.AccordingtoBeckerandKaspar,about75percentofinvestmentpolicymeasuresenactedinAsia-Pacificbetween2021and2023wereliberalizinginnature.Amongthem,thePhilippinesestablishedGreenLane

s5

forstrategicinvestments,afteralsohavingallowed100percentforeignownershipintherenewableenergysector;SriLankaremovedobstaclesandbureaucraticbottlenecksinitsforeigninvestmentapprovalprocesses;andMalaysiaannouncedtheStrategicInvestorPassforinvestorstoenterthecountryonamultiple-entrybasismuchlikeIndonesia’s‘goldenvisa’programme(Becker,Kaspar,2024).

ThisliberalizationtrendacrosstheregionreflectsabroaderrecognitionofFDI'scrucialroleineconomicdevelopment,particularlyevidentinSoutheastAsia'sstrategicpositioning.While2024hassofarseenaslow-downforAssociationofSoutheastAsianNations(ASEAN)too–oneofthemosteagerlyobservedregionsbyglobalinvestors–thistrendisexpectedtobeshort-lived,especiallywhentheeconomiesoftheASEANarecomparedwiththeEUintermsofFDIasapercentageofGDP.BeckerandKaspar’scalculationsshowthatASEANexperiencedstronglevelsofgrowthoverpastdecades,whileEUcountrieshaveseentheirshareofFDIasapercentageofGDPincontinuousdecline(ibid).Whileadeclineinthe“geopoliticaldistance”–aquantificationofthegeopoliticalclosenessofacountry’stradingpartners–holdstrueformanyeconomiesinAsia-Pacific,includingChina,JapanandtheRepublicofKorea,ASEANremainsastableeconomicpartnerforarangeofglobaleconomiesacrossthegeopoliticalspectrum–

5ExecutiveOrderNo.18mandatesallnationalgovernmentagencies(NGAs)toestablishgreenlanes,meaningtheexpeditionoftheprocessesofobtainingnecessarylicensesandpermitsforpriorityinvestments.See:

/investment-policy-monitor/measures/4215/philippines-established-green-

lanes-for-strategic-investments

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20254

contributingtothestronginterestofinvestorsintheregionandmaywellactasapresageforcontinuedandincreasinginvestorinterestinASEANinthemediumandlong-termaswellasfurthergrowthofandredirectionofassociatedtradeflowsemergingfromFDI

.6

Thisinturnwillcontinuetoopenupnewopportunitiesforinvestorsintheregion.

Turningtospecifics,theAsia-PacificregionwitnessedUS$292billionworthofgreenfieldprojectsintheJanuarytoSeptember2024period,a14percentdecreas

e7

comparedtothesameperiodin2023,whenUS$339billionhadbeenrecorded.Despiteastrongfirstquarter–strongerthanthefirstquarterof2023–greenfieldFDIbeguntoebbinquartertwoandthreeof2024,unabletokeepupwithconsistentlystrongannouncementsthroughout2023andarethusprojectedtofallshortoftherecordfiguressetin2023.

TheleadingrecipientsofFDIinthefirstthreequartersof2024wereIndia,Australia,ChinaandJapan,withUS$76billion,US$38billion,US$28billionandUS$25billionannouncedtobeinvestedrespectively.Furthermore,someeconomieshavereboundedfromstallingFDIflowsin2023:AustraliaandSingaporenotablybothsawoverUS$10billionmorepledgedtobeinvestedintheireconomiesintheJanuarytoSeptemberperiodof2024,comparedtothesameperiodin2023;US$13billionand$12billion,tobeprecise.Despitethesepositivedevelopments,theirgainswereinsufficienttooffsetthegeneralslowdownofFDIintotheregion,withseveraleconomiesexperiencingsignificantdecreasesininvestmentflows.Indonesia,Malaysia,thePhilippinesandtheRepublicofKorearecordeddecreasesofsometimesfarbeyondtheUS$10billionmark–namely,US$27billion,US$12billion,US$11billionandUS$10billion,respectively.However,thiscanpartlybeexplainedbyrecordbreakingannouncementsthepreviousyearthatarenowbeingimplemented,asinthecaseofMalaysiaforinstance,whichsawseveralbillionsinvestedinsemiconductormanufacturingin2023.

Figure1.AnnouncedGreenfieldFDIinflowsandoutflowsfromAsia-Pacific,2014-2024*

(US$millions)

Source:ESCAPcalculationsbasedonfDiMarketsdata(accessedNovember2024).*January-September2024.

6See:

/featured-insights/future-of-asia/asia-the-epicenter-of-global-trade-shifts

7YearoveryearchangesrefertotheJanuary-Septemberperiodsin2023and2024.

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20255

Outwardgreenfieldannouncements,ontheotherside,surpassedtheinflowlevelsofthefirstthreequartersof2023by9percent,increasingfromUS$314billiontoUS$341billion(figure1).Whilethelastquarterof2023sawinflowsintoAsia-Pacificcatch-upandsurpassoutwardFDIfiguresthatyear,outflowsin2024appeartobeprimedtosurpassthelevelsofinwardFDIintotheregion.ThisreinforcesAsia-Pacific'spositionasoneoftheworld'stopsourcesofoutwardFDI,withinvestmentsflowingbothwithintheregionandtomarketsworldwide.

ThebiggestincreasesinoutwardinvestmentthisyearwererecordedinMalaysia(+US$34billion),Japan(US$27billion)andtheRepublicofKorea(US$20billion).Atthesametime,companiesfromChina(includingHongKong,ChinaandMacau,China),IndiaandtheRussianFederationcommittedsignificantlylesscapitaltoendeavorsabroadthantheydidthepreviousyear-US$63billion,US$9billionandUS$3billionless,respectively.

“Despiteamoderateslow-downaftertherecordyearof2023,theAsia-Pacific

regionremainsadesirablelocationforinvestorsandisexpectedtocontinuetodo

sofortheforeseeablefuture”

However,thisregionalsnapshotdoesnotcaptureallthenuances,developmentsandchallengesacrossESCAP’smemberandassociatememberStates.Therefore,thefollowingsectionswillprovidedetailsonsubregional,intraregionalandsectoraltrends.

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20256

2.SubregionalFDItrends

Asinpreviousyears,thedistributionofinwardandoutwardGreenfieldFDIwashighlyunevenacrossandwithinsubregionsofAsia-Pacificin2024(figure2).Figures2and3illustratetherespectivegrowthanddeclineratesofFDIforbothinwardandoutwardFDIpersubregion.Thefollowingsubsectionspresentmoredetailspersubregion.

Figure2.GreenfieldFDIinflowgrowthratesforsubregionsinAsia-Pacific*

Source:ESCAPcalculationsbasedonfDiMarkets(accessedNovember2024).*January-September2024,comparedtothesameperiodin2023.

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20257

Figure3.GreenfieldFDIoutflowgrowthratesforsubregionsinAsia-Pacific*

Source:ESCAPcalculationsbasedonfDiMarkets(accessedNovember2024).*January-September2024,comparedtothesameperiodin2023.

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20258

2.1EastandNorth-EastAsia

EastandNorth-EastAsiaattracted21percentoftheAsia-Pacificregion’sgreenfieldinvestments,thethirdhighestofsubregionsatUS$60.5billion.Theregionsawadecreaseof14percentoverthesameperiodlastyear,thesameasthedeclinefortheAsia-Pacificregionasawhole.InwardgreenfieldinvestmentsonlyincreasedforJapan,up13percent,meanwhile,investmentsintoandChina,includingHongKong,ChinaandMacau,Chinafell10percent,Mongoliadropped11percentandtheRepublicofKoreasawthelargestdeclinedown69percent.Japan’sreboundininvestmentcanlargelybeattributedtoinvestmentsintodatacenter

s8

andsemiconductor

manufacturing9,

ascompaniescontinuetodiversifytheirproductionbases.In2023Japanissueditssemiconductoranddigitalindustrystrategywithplanstoprovidesubsidiestoproducer

s10.

FurthereffortstostrengthenthenationalchipandartificialintelligenceindustriesincludedtheallocationofUS$65billiontoonshorefacilitiesfromleadingchipmakerstostrengthenthesemiconductorsupplychaininwakeofthepost-covidbreakdowns,asannouncedinNovemberof2024

.11

Box1:SampledealintheregionChinatoproducesustainablejetfuel

TotalEnergiesandChinaPetroleumandChemical

CorporationhavesignedaHeadsofAgreementto

jointlydevelopaSustainableAviationFuel(SAF)

productionunitatarefineryinChinaatanestimatedUS

$591million.Theplannedunit,whichwillbejointly

owned,willhavethecapacitytoproduce230,000tons

ofSAFperyear,andwillprocesslocalwasteorresidues

fromthecirculareconomy(cookingoilsandanimalfats).

Source:

/media/news/press-releases/china-

totalenergies-and-sinopec-join-forces-produce-sustainable-jet-fuel

Inabsolutenumbers,JapansawthelargestincreaseinGreenfieldFDI,upUS$2.8billiontoUS$24.6billionin2024.Mongoliasawthesmallestdrop,downUS$6milliontoUS$52million,followedbyChina,includingHongKong,ChinaandMacau,

8See:

/en/news/glps-ada-breaks-ground-on-second-building-at-tokyo-

campus-japan/

9See:

/en-jp/about/news/2024/20240206-1.html

10See:

/technology/japan-aims-treble-sales-domestically-made-microchips-by-2030

-2023-04-03/

11See:

/2024/11/13/japan-is-ramping-up-efforts-to-revive-its-once-dominant-chip-

industry-.html

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/20259

China,withadecreaseofUS$3.3billiontoUS$31.5billion,continuingitstrendofseeingmuchlowerinwardinvestmentsincethepandemic.TheRepublicofKoreasawadecreaseofUS$9.7billiontoUS$4.4billion,asharpdeclinefromarecordUS$17.0billionin2023.

“ThethreebiggestinvestorsinAsiaandthePacificin2024,China,Japanandthe

RepublicofKoreaareinvestingheavilyrenewableenergiesandsemiconductor

sectors,providingfundingforcountrieswithintheAsia-Pacifictopursuestrategic

objectives,suchasloweringemissionandimprovingdigitalinfrastructure”

Intermsofgreenfieldinvestmentoutflows,EastandNorth-EastAsiaonlyregisteredaslightyear-to-datedecreaseof6percenttoUS$226.8billioninoutboundFDI.WhileChina,includingHongKong,ChinaandMacau,Chinasawasharpdeclineof35percentorUS$62.7billiontoUS$115.8billionthiswasmostlyoffsetbylargeincreasesfromJapan(up85percenttoUS$69.2billion)andtheRepublicofKorea(up63percenttoUS$51.9billion).BothMongoliaandtheDemocraticPeople’sRepublicofKoreasawnooutboundinvestmentsthusfarin2024.

2.2South-EastAsia

GreenfieldinvestmentinflowsintoSouth-EastAsiafell33percent,fromUS$123.6billiontoUS$82.7(figure2).Theregionattracted28percentofGreenfieldFDIinAsia-Pacificyearin2024thesecondhighestofESCAPsubregions.OnlyafewcountriessawincreasesinGreenfieldFDIwhichwasledbySingapore,up167percenttoUS$18.6billion,followedbyThailand,up43percenttoUS$5.9billion,andBruneiDarussalamup1959percenttoUS$66millioncomparedtothesameperiodin2023.VietNamsawthelowestdeclineof12percenttoUS$16.3billion,whileothernationssawlargerdeclinesincludingMalaysia(-39percenttoUS$18.5billion),Myanmar(-48percenttoUS$55million),thePhilippines(-59percenttoUS$7.7billion),Cambodia(-63percenttoUS$750million),LaoPDR(-63percenttoUS$264million)andIndonesia(-65percenttoUS$14.6billion).Atthetimeofwriting,Timor-Lestehasnotrecordedanyannouncementsthusfarin2024.Malaysiawasthetargetforthelargestinvestmentofthesubregionin2024,receivingUS$2.1billionfromChina’sByteDancetosetupanartificialintelligencehubaccompanyinganadditionalinvestmentofUS$337milliontoexpandthecompany'sdatacentersinMalaysia

.12

12See:

/technology/bytedance-plans-21-bln-investment-malaysia-ai-minister-says-2024-

06-07/

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/202510

Box2:SampleFDIprojectintheregionGreenHydrogenProjectinIndonesia

SaudiArabia’sACWAPowerissettodevelopthelargest

greenhydrogenfacilityinIndonesiawiththestate-

ownedelectricityproviderPTPerusahaanListrikNegara

(PLN)andthestate-ownedfertiliserandchemical

producerPTPupukIndonesia.TheGarudaHidrogen

Hijau(GH2)Project,whichisexpectedtostart

commercialoperationsin2026,willrunon600MWof

solarandwindpower,willproduce150,000tonnesof

greenammoniaperyear,andisvaluedatUS$1billion.

Source:

/news/acwa-power-signs-deal-to-

develop-the-largest-green-hydrogen-project-in-indonesia

OutboundGreenfieldFDIfromSouth-EastAsiarosesharply,up153percentfromUS$30.7billiontoUS$77.5billion(figure3).TheincreasewasduetooutflowsfromMalaysiasoaring4,104percenttoUS$34.4billionasPetronascommittedUS$30billiontoconstructanLNGplantinthePatagoniaregionofArgentin

a13.

Singaporeaidedinincreasingtheregion’soutflowswithasizable47percentincreasefrombringingittoUS$37.2billionsofarin2024.Vietnam(US$2.7billion,up84percent),Thailand(US$1.6billion,up33percent)andthePhilippines(US$1.3billion,up9percent)weretheothermajorcontributorsfromtheregion.

2.3SouthandSouth-WestAsia

SouthandSouth-WestAsiaattracted28percent,thelargestshareofgreenfieldinvestmentsinAsia-Pacific,totalingUS$83.3billionin2024.Thesubregionsawadeclineof16percent,asSriLanka(-90percenttoUS$730million),Pakistan(-83percenttoUS$1.8billion),andTürkiye(-77percenttoUS$2.4billion)allsawsharpdeclinesoverthesameperiodon2023.GainsforIndia,thelargestGreenfieldFDIreceiverinAsia-Pacificmostlyoffsetthesedeclinesasthecountrysawanincreaseof17percent,reachingUS$75.6billionsofarin2024,ontrackforarecordyear.Indiahasseenseveralmegadealsthisyearacrosssectorsincludingsemiconductors,metals,renewableenergy,communications,automotiveOEM,software,dataprocessing,andmorefromcompaniesincludingPowerchipTechnology,ArcelorMittalNipponSteel,STTGlobalDataCentres,Toyota,Vinfast,Protonasandmore.ThecontinuedstrengthofIndiawhenitcomestoattractinglarge-scaleFDIprojects,cannotonlybeattributedtoitsmarketsizeandoverallgrowthtrajectorybutthecountryisalsoavidlyissuingtargetedsupportpoliciesandincentiveschemes

13See:

/story/glng-petronas-and-argentina-s-ypf-to-invest-30bn-to-construct-lng-plant-in-

patagonia-337113

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/202511

liketheProductionLinkedIncentive(PLI)schemelaunchedin2020.ThePLIschemeistoboostdomesticproductionandattractinvestmentsintargetsectorsbyofferingcompaniesafixedpercentageofincentivesontheincrementalsalesofmanufacturedgoodsovertheirfirstfiveyears,encouragingincreasedmanufacturingcapabilitieswithinthecountry(Wandhe,2024).Bhutanalsosawinvestmentsincrease,up74percenttoUS$1.1billionwhileitwasflatfortheMaldivesatUS$554million.TheremainingcountriessawdecreasesincludingNepal(-68percenttoUS$237million)andBangladesh(-68percenttoUS$866million)ornoinvestments(AfghanistanandIran).

Bhutan'sincreaseininvestmentflowsalignswithitsambitiousdevelopmentvision,exemplifiedbyitsflagship"GelephuMindfulnessCity"project.Thisinnovativeinitiativerepresentsadistinctiveapproachtoeconomicdevelopment,designedtoattractFDIwhilealsomaintainingBhutan'sGrossNationalHappinessindex.TheplannedsustainableeconomichubstrategicallypositionsitselfasacorridorbetweenSouthandSoutheastAsia,incorporatingeco-friendlyinfrastructure,mindfulness-focusedspaces,anddiversebusinessopportunities.Tofinancethisdevelopment,Bhutanhaslaunchedseveralfundinginitiativestargetingnon-residentBhutaneseinvestors.Theprojecthasgarneredhigh-levelsupport,withboththePrimeMinisterandKingofBhutanactivelypromotingit

.14

Box3:SampleFDIprojectintheregionHydropowerprojectinBhutan

India’sTataPowerhasannouncedastrategicpartnershipwithBhutan’sDrukGreenPowerforthedevelopmentofthe600MWKhorlochuhydropowerproject.TheprojectisestimatedatUS$822millionwithexpectedcompletionin2029.ItwillhelpmeetBhutan’swinterelectricitydemandsandexportsurplustoIndiatoexpanditscleanenergygrid.

Source:

/news/tata-power-druk-green-

khorlochhu/?cf-view

OutwardGreenfieldinvestmentfromthesubregionfell19percenttoUS$19.1billionin2024(figure3).Indiaagainwasthelargestsourceofoutboundinvestmentfortheregion,responsibleforUS$10.1billion,or52percentofthesubregion’soutflow,thoughthiswasdown47percentfromthesameperiodin2023.Onanothernote,Türkiyeemergedasalargeinvestorthisyear,committingUS$7.6billion,a92percentincreasespearheadedbyaUS$1.62billioninvestmentfromYilporttoexpand

14See:

/world/asia-pacific/buddhist-bhutan-build-mindfulness-city-woo-investment-

create-jobs-2024-11-11/

ASIA-PACIFICTRADEANDINVESTMENTTRENDS2024/202512

twoportsinElSalvadorandoperatethemjointlywiththelocalauthorities

.15

Pakistancontinuedtoincreaseitsoutwardinvestments,up134percenttoUS$1.1billion.

2.4NorthandCentralAsia

GreenfieldinvestmentinflowsintoNorthandCentralAsiarose27percenttoUS$24.8billionyearin2023.Inwardgreenfieldinvest