Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in Cambodia
This study examines the effect of investment promotion through the special economic zone (SEZ) mechanism on foreign direct investment (FDI) inflow across Cambodia. We applied generalized methods of moments (GMM) to panel data constructed from 19 Cambodian provinces during 2015–2019. Our results show...
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| Format: | Article |
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MDPI AG
2022-09-01
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| Series: | Economies |
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| Online Access: | https://www.mdpi.com/2227-7099/10/9/231 |
| _version_ | 1797489222710460416 |
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| author | Chuop Theot Therith |
| author_facet | Chuop Theot Therith |
| author_sort | Chuop Theot Therith |
| collection | DOAJ |
| description | This study examines the effect of investment promotion through the special economic zone (SEZ) mechanism on foreign direct investment (FDI) inflow across Cambodia. We applied generalized methods of moments (GMM) to panel data constructed from 19 Cambodian provinces during 2015–2019. Our results show that the number of SEZs positively affects both FDI inflow and diversification across the country, while capital invested in developing SEZs increases only the latter. Other SEZ variables, including the presence of SEZ, its intensity, and the age of the first established SEZ in a province, are mostly found to be positively associated with FDI and diversified FDI but not notably significant. Supportably, the existence of SEZ is confirmed to be significant by the <i>t</i>-test method, meaning that the SEZ province can attract more FDI than the non-SEZ one. Some provincial efforts and characteristics, including annual government expenditure, number of public relations, population density, population 18 years old and up, deep-sea ports, and international gates, likely significantly influence FDI inflow into the provinces of Cambodia. All in all, the SEZ mechanism attracts more diversified foreign investment activities, and it has a significant effect on the distribution of FDI in Cambodia. |
| first_indexed | 2024-03-10T00:14:23Z |
| format | Article |
| id | doaj.art-c7e9a4e60db7426eb239a075ab42c136 |
| institution | Directory Open Access Journal |
| issn | 2227-7099 |
| language | English |
| last_indexed | 2024-03-10T00:14:23Z |
| publishDate | 2022-09-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Economies |
| spelling | doaj.art-c7e9a4e60db7426eb239a075ab42c1362023-11-23T15:55:17ZengMDPI AGEconomies2227-70992022-09-0110923110.3390/economies10090231Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in CambodiaChuop Theot Therith0PhD Program, Graduate School of Asia-Pacific Studies, Waseda University, Tokyo 169-0051, JapanThis study examines the effect of investment promotion through the special economic zone (SEZ) mechanism on foreign direct investment (FDI) inflow across Cambodia. We applied generalized methods of moments (GMM) to panel data constructed from 19 Cambodian provinces during 2015–2019. Our results show that the number of SEZs positively affects both FDI inflow and diversification across the country, while capital invested in developing SEZs increases only the latter. Other SEZ variables, including the presence of SEZ, its intensity, and the age of the first established SEZ in a province, are mostly found to be positively associated with FDI and diversified FDI but not notably significant. Supportably, the existence of SEZ is confirmed to be significant by the <i>t</i>-test method, meaning that the SEZ province can attract more FDI than the non-SEZ one. Some provincial efforts and characteristics, including annual government expenditure, number of public relations, population density, population 18 years old and up, deep-sea ports, and international gates, likely significantly influence FDI inflow into the provinces of Cambodia. All in all, the SEZ mechanism attracts more diversified foreign investment activities, and it has a significant effect on the distribution of FDI in Cambodia.https://www.mdpi.com/2227-7099/10/9/231investment promotionspecial economic zoneSEZforeign direct investmentFDI |
| spellingShingle | Chuop Theot Therith Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in Cambodia Economies investment promotion special economic zone SEZ foreign direct investment FDI |
| title | Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in Cambodia |
| title_full | Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in Cambodia |
| title_fullStr | Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in Cambodia |
| title_full_unstemmed | Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in Cambodia |
| title_short | Effect of Investment Promotion through the Special Economic Zone Mechanism on the Distribution of FDI in Cambodia |
| title_sort | effect of investment promotion through the special economic zone mechanism on the distribution of fdi in cambodia |
| topic | investment promotion special economic zone SEZ foreign direct investment FDI |
| url | https://www.mdpi.com/2227-7099/10/9/231 |
| work_keys_str_mv | AT chuoptheottherith effectofinvestmentpromotionthroughthespecialeconomiczonemechanismonthedistributionoffdiincambodia |