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Regional Investment Pioneers in South Asia : The Payoff of Knowing Your Neighbors.

Bibliographic Details
Main Author: Kathuria, Sanjay.
Other Authors: Yatawara, Ravindra A., Zhu, Xiao'ou.
Format: eBook
Language:English
Published: Washington, D. C. : World Bank Publications, 2021.
Edition:1st ed.
Series:South Asia Development Forum Series
Subjects:
Commerce.
Commercial policy.
Investments, Foreign.
Electronic books.
Online Access:Click to View
Table of Contents:
  • Front Cover
  • Contents
  • Acknowledgments
  • About the Authors
  • Abbreviations
  • Overview
  • Context and Motivation
  • Investment Landscape: Low Levels of Inward FDI
  • Investment Landscape: Low Levels of Outward FDI
  • Investment Landscape: Lowest Intraregional Investment Share among Developing Economies
  • Key Drivers of Outward Investment of South Asian Firms
  • Key Constraint: Restrictiveness of South Asian Inward and Outward FDI Policy Arrangements
  • Key Constraint: Low Knowledge Connectivity and Bilateral Trust
  • Regional Pioneers and the Determinants of Investment Entry: Which Firms Succeed and Which Firms Do Not?
  • Policy and Operational Implications
  • Concluding Remarks
  • Notes
  • Reference
  • Key Messages
  • Chapter 1 The State of Play in South Asia
  • Introduction
  • Factors Influencing Regional Dynamics
  • Weak Track Record on Global Inward FDI
  • Low Intraregional Investment
  • A Spark of Optimism and an Opportunity to Scale Up?
  • Relevance of the Report
  • Plan of the Report
  • Annex 1A: Underlying Profiles of South Asian Economies
  • Annex 1B: The South Asian Trade Landscape: Foreshadowing the Trade-Investment Nexus
  • Notes
  • References
  • Chapter 2 Cross-Border Engagement: An Integrated Analytical Framework
  • Introduction
  • Incorporating a Value Chain Approach
  • Foreign Market Entry Decision
  • Toward a Spectrum of Engagement Modes: Variation of Entry Costs across Modes
  • Information, Networks, and Learning: Variation of Entry Costs across Firms
  • Concluding Remarks
  • Notes
  • References
  • Chapter 3 Spotlight on Outward Foreign Investment and Foreign Direct Investment Policies
  • Introduction
  • Outward FDI and Intraregional Investment: Evidence from CDIS and UNCTAD Data
  • Policy Environment for Intraregional Investment
  • Scope of and Strategies for OFDI: Evidence from Firm Surveys and Case Studies.
  • Concluding Remarks
  • Annex 3A: Investment Hubs: The India-Mauritius Connection and How Singapore Fits In
  • Notes
  • References
  • Chapter 4 Knowledge Connectivity in South Asia and Its Impact on Outward Foreign Direct Investment
  • Introduction
  • Knowledge Connectivity, Networks, and Bilateral Trust in South Asia
  • Key Results on Investor Decision-Making in South Asia
  • Beyond Entry: Evolution of Investment Destinations
  • Bridges of Knowledge: Key Channels of Awareness of Investment Opportunities
  • Concluding Remarks
  • Annex 4A: Information, Networks, and Learning
  • Notes
  • References
  • Chapter 5 Policy and Operational Implications
  • Introduction
  • Information Frictions and Enhancing Knowledge Connectivity
  • Physical and Digital Connectivity
  • Regulatory and Promotion Policies for OFDI
  • Implications for Inward FDI Policy and Promotion
  • Emerging Business Practices and Policy Making
  • Unilateral National Reforms Can Spur Regional Engagement
  • Implications of the Pandemic for Policy Prioritization and Regional Engagement
  • Concluding Remarks: Toward a More Engaged South Asia
  • Annex 5A: Implications for Policy and Operations
  • Notes
  • References
  • Appendix A Consolidated Direct Investment Survey Data Augmentation
  • Appendix B Data Description and Empirical Results
  • Glossary
  • Boxes
  • Box 2.1 Internationalization Strategy Options for Serving Consumer Markets at Home and Abroad
  • Box 3.1 Defining Inward and Outward Foreign Direct Investment
  • Box 3.2 Issues with Global Foreign Direct Investment Data
  • Box 3.4 Timeline of India's Gradual Path to Liberalization of OFDI
  • Box 3.5 Promotional Measures for Outward FDI in Selected Economies
  • Box 3.6 Summary of Outward Foreign Direct Investment Benefits from a Value Chain Perspective
  • Box 3.7 How OFDI Helped MAS Holdings (Sri Lanka) Upgrade along the Apparel Value Chain.
  • Box 4.1 Estimated Equation for the Determinants of Outward Investment
  • Figures
  • Figure O.1 Low South Asian Intraregional Investment
  • Figure O.2 Bilateral Knowledge Connectivity in South Asia, by Home Country
  • Figure 1.1 IFDI Stock in Developing Economies from Regional versus Extraregional Source Economies, 2017
  • Figure 1.2 Intraregional Investment as a Share of IFDI from the World: Developing Economies versus All Economies, 2017
  • Figure 1.3 South Asian Intraregional Exports, 1990-2018
  • Figure 1.4 Bilateral Knowledge Connectivity in South Asia, by Home Country of Investors
  • Figure 1A.1 Geographic Profile of South Asia
  • Figure 2.1 Multinational Location Options and Frictions
  • Figure B2.1.1 Internationalization Options for Serving Consumer Markets at Home and Abroad
  • Figure 2.2 Relationship of Productivity to Serving Foreign Markets by Exporting and Investing Abroad
  • Figure 3.1 Developing Economy Share of World OFDI Flows and Stocks
  • Figure 3.2 Outward FDI Stock from Developing Economies to the World, 2017
  • Regional versus Extraregional Destination Economies
  • Figure 3.3 Intraregional Investment as a Share of Total OFDI, 2017
  • Regional Developing Economies and All Regional Economies
  • Figure 3.4 Intraregional Outward Foreign Direct Investment into South Asia, 2012-17
  • Figure 3.5 Outward Foreign Direct Investment from South Asia, 2012-17
  • Figure 3.6 Global Trends in Inward FDI Policies, 2003-18
  • Figure 3.7 Share of Female Chief Executive Officers in South Asia
  • Figure 3.8 Outward Investors from Various Sectors (Based on International Standard Industrial Classification of All Economic Activities)
  • Figure 3.9 Motivations for Investing in South Asia and outside South Asia
  • Figure 3.10 Detailed Motivations for Investing in South Asia.
  • Figure B3.7.1 How OFDI Helped MAS Holdings Upgrade along the Apparel Smile Curve
  • Figure 3.11 Distribution Investment Abroad
  • Figure 3.12 Export Platform Investment
  • Figure 3.13 Dynamic Story: From Distribution to Export Platform Investment
  • Figure 3.14 Complex Investment with Horizontal, Vertical, and Export Platform Features
  • Figure 3.15 Hybrid Horizontal Investment
  • Figure 3.16 Horizontal Investment with a Twist
  • Figure 3.17 Franchise Option
  • Figure 3.18 Management Contracts and Investment in Hotels
  • Figure 3A.1 Indirectly Routed Inflows from India's Top Foreign Direct Investment Sources
  • Figure 4.1 Bilateral Knowledge Connectivity Scores, by Destination: Identification of Knowledge Surplus and Deficit Pairs
  • Figure 4.2 Bilateral Network Connection Scores, by Destination
  • Figure 4.3 Bilateral Trust Scores, by Destination
  • Figure 4.4 The Knowledge-Trust Nexus: To Know Me Is to Trust Me?
  • Figure 4.5 Networks Reduce the Fixed Entry Costs of Investing and Lead to More Investors with Greater Variability in Productivity
  • Figure 4.6 Exporters Become Investors
  • Figure 4.7 The Role of Conglomerates and Business Groups in South Asia
  • Figure 4.8 Learning from Pioneers Induces Entry of Follower Firms by Reducing Follower Entry Costs
  • Figure 4.9 Varying Reduction of Fixed Entry Costs of Investing Based on Level of Information Frictions
  • Figure 4.10 Awareness of South Asian Investment Opportunities: Actual Investors
  • Figure 4.11 Top Three Channels of Awareness of Investment Opportunities in South Asia and Outside South Asia, across Investors and Noninvestors
  • Figure 4.12 Due Diligence Intermediaries, by Destination
  • Figure 4A.1 Bilateral Knowledge Connectivity, Network Connectivity, and Trust: Raw Z-Scores.
  • Figure 5.1 Trends in World Trade in Goods versus Intellectual Property Payments, Services Imports, and Foreign Direct Investment Flows, 1990-2017
  • Figure 5A.1 Market Opportunities Dominate the Type of Information Support Requested
  • Figure 5A.2 Access to Finance Dominates OFDI Support Requests
  • Figure A.1 CDIS Data Augmentation Doubles Data Availability and Increases Value by US3 Trillion
  • Figure A.2 Top Destinations for Outward FDI Stock from Each South Asian Economy, 2017
  • Figure A.3 Ease of Investing across Borders: Developing Regions, 2010 (0-100, best)
  • Figure A.4 Geography of India's North Eastern Region
  • Figure B.1 Comparison of Firm Activities: Full Sample versus Investors
  • Tables
  • Table 1.1 Case Studies in South Asian Intraregional Investment
  • Table 1.2 South Asian Intraregional Goods Exports and Imports, 2018 (US millions)
  • Table 1A.1 Profile of South Asian Economies, 2019
  • Table 1B.1 Sector Shares of Exports to South Asia and the Rest of the World, 2015
  • Table 1B.2 South Asian Intraregional Trade Agreements
  • Table 2.1 Serving Foreign Markets: Alternative Modes in Rising Order of Fixed Entry Costs (1 Low-9 High)
  • Table 3.1 South Asian Intraregional Investment Stocks, by Country, 2017
  • Table 3.2 Laws and Institutions Related to Outward Direct Investment Policy in South Asia
  • Table 3.3 Summary of OFDI Regulatory Policies in South Asia
  • Table B3.5.1 OFDI Policy Measures in Selected Economies
  • Table 3.4 Laws and Institutions Related to Inward Foreign Direct Investment
  • Table 3.5 Special Economic Zones in South Asia and East Asia and Pacific, 2018
  • Table 3.6 South Asian Outward Investments, by Investment Type and Investor Origin
  • Table 3.7 Destination of South Asian Outward Investments
  • Table 3.8 Sector Origin Breakdown, by Investor and Noninvestor, and Destination Region.
  • Table 4.1 Evolution of Investment Destinations: First Destination and Sequential Investing, by Investment Type.

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