Page 39 - 2022 Abstract Book RUICHSS_2022_11_17 after conference

University of Ruhuna ISSN: 2706-0063
Matara, Sri Lanka

Factors Affecting Foreign Direct Investment in the Asia and
Pacific Region

Pasindu Wannisinghe*, Sanjula Jayakody, Sashini Rathnayake, Deshani
Wijayasinghe, Ruwan Jayathilaka, Naduni Madhavika
SLIIT Business School, Sri Lanka Institute of Information Technology.
pd.wannisinghe@gmail.com

This study focused on determining the effect of the Logistics Performance Index
(LPI), Global Competitiveness Index (GCI), and Interest Rates (IR) on Foreign Direct
Investment (FDI) in the Asia and Pacific region. Data was gathered for 33 countries
in the Asia and Pacific region for the years 2007, 2010, 2012, 2014, 2016, and 2018.
The Multiple linear regression and the panel regression models were used for data
analysis. According to the findings, LPI positively affects FDI in India, Korea,
Lebanon, and Oman with negative effects in China, Kuwait, and the Philippines.
While GCI had a negative effect on FDI in Armenia, India, and Lebanon, it had a
favorable influence in China, Korea, Kuwait, Pakistan, and the Philippines.
Additionally, IR influences FDI flows in China and Egypt favorably. However, a
negative effect was seen in Korea and Lebanon. Consequently, while considering
variables of other countries that affect the FDI inflow, policymakers should
concentrate more on enhancing infrastructure needs and macroeconomic
considerations.

Keywords: Logistics Performance Index, Global Competitiveness Index, Interest
Rates, Foreign Direct Investment

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