•   John FoEh

  •   Ni Kadek Suryani

  •   Shakti Silpama


This research aims to determine the effect of the inflation rate, exchange rate and gross domestic product to the foreign direct investment in the ASEAN countries in periods of 2007-2016. The object of this research is the foreign direct investment in 11 countries of ASEAN region such as; Brunei Darussalam, Philippines, Indonesia, Cambodia Laos, Malaysia, Myanmar, Singapore, Thailand, Timor-Leste and Vietnam. The data used are secondary data with analysis by a panel data regression model using with an estimated model of random effect which were processed by Eviews tools version 10. The results of this study indicate that simultaneously the inflation rate, exchange rate, and gross domestic product have a very significant effect to the foreign direct investment. Partially, the inflation rate has a significant negative effect on foreign direct investment, while the exchange rate has a significant positive effect on foreign direct investment. The further analysis showed that the gross domestic product has no significant effect on foreign direct investment.

Keywords: Inflation Rate, Exchange Rate, Gross Domestic Product, Foreign Direct Investment


Ahmed, Shahid. 2013. Foreign Direct Investment, Trade and Economic Growth Challenges and Opportunities, New Delhi: Routledge

Arif, Dodi. 2014. Effect of gross domestic product, money supply, inflation and bi rate on the composite stock price index in Indonesia for the period 2007 - 2013. Journal of Business Economics, Volume 19 No. 3

ASEAN. 2018. ASEAN Investment Report 2018. http://asean.org/?static_ post = asean-investment-report-2017.

Chan, LMW, Keqiang Hou, Xing Li, and Dean C. Mountain. 2014. Foreign direct investment and its determinants: A regional panel causality analysis. The Quarterly Review of Economics and Finance, Vol. 54 pp. 579 - 589. www.elsevier.com

Diancu, Laura. 2013. The foreign direct investments in South-East Asia in the context of the 1997 and 2007 crises. 2n World Conference on Business, Economics and Management -WCBEM 2013. www.sciencedirect.com

Freckleton, M., Allan Wright, and Roland Craigwell. 2012. Economic growth, foreign direct investment and corruption in developed and developing countries, Journal of Economic Studies, Vol. 39 Issue 6 pp.639–652. http://dx.doi.org/ 10.1108 / 01443581211274593. www.emeraldinsight.com

Jochumzen, P. 2010. Essentials of Macroeconomics. Denmark: Ventus Publishing ApS

Kasmir. 2010. Banking Management. Third Edition. Sixth Printing. Jakarta: PT. Raja Grafindo Persada

Kaur, Manpreet., Surendra S. Yadav, and Vinayshil Gautam. 2013. A bivariate causality link between foreign direct investment and economic growth. Journal of International Trade Law and Policy, Vol. 12 Issue 1 pp. 68 - 79. http://dx.doi.org/10.1108/14770021311312502. www.emeraldinsight.com

Meita Sari, Agung Ayu R. Gusti., and Gde Kajeng Baskara. 2018. Effects of Economic Growth, Interest Rates, and Exchange Rates on Foreign Direct Investment in Indonesia. Eud Management E-Journal, Vol. 7, No. 7.

OECD. 2018. Economic Outlook for Southeast Asia, China and India 2018: Fostering Growth Through Digitalisation. Paris: OECD Publishing. http://dx.doi.org/ 9789264286184-en

Prasetyo, DA, and A. Darmawan. 2017. Influence of inflation risk, interest rate risk, exchange rate risk and leverage on profitability (a study of food and beverage sub sector companies listed on the Indonesia Stock Exchange in 2012-2016). Journal of Business Administration (JAB), Vol. 50 No. 3. business administration. studentjournal.ub.ac.id

Pratiwi, Nabilla, M., Moch Dzulkirom AR., and Devi F. Azizah. 2015. The Influence of Inflation, SBI Interest Rates, and Exchange Rates on Foreign Investment and Economic Growth in Indonesia (2004 to 2013). Journal of Business Administration (JAB), Vol. 26, No. 2. business administration. studentjournal. ub.ac.id

Setiawan, SRD 2017. BI: Post-Financial Crisis, ASEAN is now Rising and Strong. https://ekonomi.kompas.com/read/2017/04/28/151506626/bi.pasca-krisis.finance. asean.kini.bangkit.dan.kuat.

Tieying, Ma. 2016. Why Japan's Investing More in Southeast Asia. https: // www. dbsinsights.com/asias-growth-story/japans-investing-southeast-asia.

Tri Basuki, Agus. 2016. Regression Analysis in Economic & Business Research: Equipped with SPSS & Eviews Applications. Ed. 1, Cet. 1. Jakarta: Rajawali Press





Download data is not yet available.


How to Cite
FoEh, J., Suryani, N., & Silpama, S. (2020). The Influence of Inflation Level, Exchange Rate and Gross Domestic Product on Foreign Direct Investment in the ASEAN Countries on 2007 - 2018. European Journal of Business and Management Research, 5(3). https://doi.org/10.24018/ejbmr.2020.5.3.311