Foreign Direct Investment in Manufacturing Sector in Malaysia
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This paper analyses the determinants of foreign direct investment (FDI) in the
manufacturing sector in Malaysia from eleven countries during the period 1988 to
2000. The empirical results indicate that gross domestic product, lending interest rate,
labour productivity, exports to home country and imports from home country
significantly influenced the level of FDI inflows into Malaysia. However, exchange
rate, exchange rate variation, wage and openness index were not important in
influencing FDI.