ABSTRACT
The 1990s were globally a period of high foreign investment triggered by improvements in communication technology and greater recognition of the benefits of foreign investment. Improvement in communications technology allowed firms to develop increasingly effective strategies resulting in an efficient use of available capital. The change in attitudes of governments resulted in a reduction of direct and indirect obstacles to foreign investment. In order to attract foreign investment, governments of some Asian economies increased incentives to foreign investors. Privatization and deregulation resulted in further increases in foreign investment. Thomsen (1999), Czinkota, Ronkainen, and Moffett (2005) and Hill (2005) have argued that worldwide increases in foreign investment can also be attributed to globalization. Foreign investment has become an integral part of corporate strategies in recent years. The growth of foreign investment has considerably increased due to the fact that competing firms follow each other into the new market. 1
