Macroeconomic Variables Affecting Foreign Direct Investment in New S-Curve Industries of Thailand
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Abstract
Even if public sector had played a supporting role of Foreign Direct Investment (FDI) in New S-curve industry, the investment for industry development was still interrupted so that it could not correspond with changing high-technology and innovative industry. Thus the aim of this study was to analyze macroeconomic variables affecting FDI inflows to the New S-curve industry of Thailand by using quarterly secondary data from 2017-2020 with Multiple Regression analysis and Ordinary Least Square (OLS) approach, in order to identify relationship between macroeconomic variables which significantly affected FDI inflows to the 5 New S-curve industries: Robotics industry, Aviation and Logistics industry, Biofuels and Biochemicals industry, Digital industry, and Medical Hub industry. The results showed that: government's domestic investment growth rate and the policy interest rate had a positive effect on foreign direct investment of robotics industry and medical hub industry, while rate of export growth had a negative effect on foreign direct investment of digital industry and medical hub industry; and labor productivity index has no effect on FDI inflows in the New S-curve industry. Therefore, government was encouraged to adopt these results in considering measures for establishing supporting policies in order to attract more foreign direct investment in New S-Curve industry continually.
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