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Foreign Direct Investment In Malaysia

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CHAPTER 1: INTRODUCTION
1.0 Introduction
This study conducted to investigate the impact of foreign direct investment (FDI) on economic growth in Malaysia for the period 1980 – 2011 using the annual time series data.
Foreign Direct Investment (FDI) and Gross Domestic Product (GDP) are the main determinant of economic growth on any country (Pradeep, 2011). FDI can be defined as a cross border corporate governance mechanism through which company obtains productive assets in another country and prolonged to include the investment which made to attain lasting interest in enterprises operating outside of the economy of the investor (Gopal, 2012). According to World
Bank, GDP refer to the value of final goods and services that produce in a country …show more content…

Therefore, this study attempts to test for the previous studies using other countries which have different result compared to Malaysia. Hence, this study will focus only on FDI at Malaysia.
1.2 Problem statement
In Budget 2013, the Prime Minister announced from the first focus the boosting investment activity stated to transform Malaysia from producer to a global integrated trading hub
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for oil and gas industry. The existence of valuable mineral resources, such as oil and natural gas make blessed Malaysia to get more revenue from oil and gas. Therefore, the government have to undertake several strategic measures to enhance the nation’s capability, particularly in providing an ecosystem to support the development of the chain of refining, storage and trading.
The total production from the oil and gas industry in Malaysia is very affecting to the national income to this country. This is because the oil and gas industry is the one of the prominent agricultural industries in Malaysia. Based on the planning in budget 2013 to transform oil and gas industry in Malaysia to a global integrated trading hub, it is important to identify factors that will affect the economic growth. The transformation from producer to …show more content…

What is the impact of FDI on economic growth in Malaysia? ii. Whether factors such as labour forces, external debt and trade give a positive effect to the GDP when transform to global integrated hub industry?
So, this study will focus on the transformation Malaysia from producer to a global integrated trading hub for oil and gas industry. When government perform this planning that involve in the budget 2013, the investor automatically implicated to Malaysia industry.
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1.3 Objectives of study
The general objective of the study is to investigate the impact of foreign direct investment (FDI) on economic growth in Malaysia for the period 1980 – 2011 using the annual time series data.
The specific objectives of this study include:-
i. To ascertain whether there is impact of foreign direct investment (FDI) on the economic growth of the Malaysian. ii. To determine the extent to which the independent variables include labour forces, trade, and external debt are related and give impact to economic growth.
1.4 Organization of study
The study is organized and presented as described by chapter as following. Chapter one introduce the research’s overview of this study which include the background of

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