ABSTRACT
Regional policy decision-makers can leverage these locational factors to attract foreign direct investment (FDI) and help connect the region to the global value chain (GVC). One of the first ways to build GVCs is through internationalisation efforts, that is, as multinational enterprises (MNEs) delocalise activities beyond national borders. A growing body of evidence looks at the major regional influences in the relocation of different business functions of MNEs. The entry mode choice depends on the characteristics of the investing MNE and characteristics of the host national and regional economy. Most evidence explores the host economy at the national level, with less known at the subnational level. The Penang Skills Development centre’s creation allowed the region to build a workforce with industry- specific skills. It was firm and industry driven, responding to needs in human capital development in order to continue attracting global investment flows and building GVCs. There are several various drivers of location choices when building GVCs through FDI.
