—The objectives of this study were: 1) to explore factors that have positive and significant influence on Chinese firms’ decision making in FDI in Thailand, 2) to identify factors that can be the significant predictor of Chinese FDI in Thailand, and 3) to provide recommendations for Thai government and policy makers in order to improve Thailand’s investment climate with the intention to maintain existing Chinese FDI and attract more potential investors from China.
The researchers utilized the FDI model which consists of 6 factors which are PF (political factors), GF (government regulations and laws factors), LF (location factors), MF (market Factors), SF (social and cultural factors),
and FF (financial factors).
This model was formulated from the OLI and PESTEL framework. Research findings showed that there were only two factors, location factors and Social and cultural factors, having positive and significant correlation with Chinese FDI. However, none of any factors had predictive power on Chinese FDI. The findings indicated that investment motivations and Chinese cultural context “guan xi” played a very important role to influence Chinese decision-makers in FDI in Thailand.
—FDI, eclectic paradigm, OLI, entry modes, PESTEL, Chinese, Thailand.
Xiao Ling Huang was with Chulalongkorn Business School, Chulalongkorn University, Thailand (e-mail: email@example.com).
Athapol Ruangkanjanases and Chenin Chen are with Chulalongkorn Business School, Chulalongkorn University, Thailand (e-mail: firstname.lastname@example.org, email@example.com).
Cite: Xiao Ling Huang, Athapol Ruangkanjanases, and Chenin Chen, "Factors Influencing Chinese Firms’ Decision Making in Foreign Direct Investment in Thailand," International Journal of Trade, Economics and Finance vol.5, no.6, pp. 463-471, 2014.