Asian Development Bank (ADB) - Facilitating Small and Medium- sized Enterprises (SMEs) Foreign Direct Investment (FDI) Flows: An ASEAN+6 Case Study - 2019

Description of Project:

The regional technical assistance (TA) (i) assessed the likely impact of investment and other FDI- related provisions in the draft Regional Comprehensive Partnership Agreement (RCEP) for enhanced FDI flows in ASEAN+6; (ii) identified barriers to enhanced SMEs’ FDI flows between ASEAN+6 countries; and (iii) proposed policy reforms, capacity development programs, and private sector transactional support to translate likely RCEP provisions and the potential internationalization of SMEs into enhanced FDI flows in the ASEAN+6 countries, particularly SME- driven FDI for agriculture, manufacturing, and services.

Description of services provided by MKE :

  • Analyzed RCEP agreement impact

  • Undertook an enterprise level survey in India, Thailand and Cambodia to determine the drivers and motives as well as key barriers and challenges specific to SMEs in agriculture, manufacturing, and services that were investing or contemplating to invest specifically in other countries in the RCEP region; prepared a report on the results of the surveys, and provided recommendations to enhance outward FDI from source countries and FDI facilitation program for each of the destination countries;

  • Identified three destination countries in consultation with ADB; provided recommendations for facilitating outward SME FDI from the source countries (support needed by SME investors); and prepared FDI facilitation papers for each of the three destination countries. All of these recommendations aimed to enhance outward FDI driven by SMEs in agriculture, manufacturing, and services in one or more of the identified source countries and inward FDI to one or more of the identified destination countries in the RCEP region.