THE NEXUS BETWEEN INTEREST RATES, CORRUPTION OF CONTROL AND INFRASTRUCTURE ON FOREIGN DIRECT INVESTMENT IN EMERGING ASIA

Ariodillah Hidayat; Dwiki  Ariefandri; Alghifari Mahdi  Igamo; Xenaneira Shodrokova

Ariodillah Hidayat Universitas Sriwijaya
Dwiki Ariefandri Universitas Sriwijaya
Alghifari Mahdi Igamo Universitas Sriwijaya https://orcid.org/0000-0001-6069-0435
Xenaneira Shodrokova Universitas Sriwijaya https://orcid.org/0009-0003-8034-6617

Abstract

This study examines the effects of interest rates, corruption of control, and infrastructure on Foreign Direct Investment (FDI) in emerging Asia. This study took samples from Indonesia, Malaysia, Thailand, India, South Korea, Oman, and Qatar. By using secondary data sourced from the World Bank with the period 2004 to 2021. This study uses a fixed effect model type of panel data regression. The results show that interest rates have a negative and significant effect on FDI, while control of corruption and infrastructure are able to significantly increase FDI. Foreign investors tend to look for a cheaper and more stable investment environment, therefore high interest rates make it less attractive. Developing Asian countries need to invest in infrastructure projects and ensure that transparent and clean business practices are implemented.