ECONOMIC
GROWTH AND FOREIGN DIRECT INVESTMENT
FOREIGN
DIRECT INVESTMENT
Foreign
direct investment (FDI) in Thailand has been a major contributor
to Thailand's economic growth since the mid-1980s. The initial
surge of FDI occurred in 1988 and 1989, when the level of FDI
tripled in 1988 compared to the previous year, and then doubled
in 1990 to US$2.5 billion. Foreign investment has not, however,
increased steadily. Occasional drops in the Stock Exchange of
Thailand caused FDI to decrease at times, but these declines were
usually followed by strong upsurges in FDI soon after. For instance,
the amount of foreign investment dropped to only US$1.3 billion
in 1994, down from US$1.7 billion in 1993, because of a huge withdrawal
of funds from the Thai stock market and the recession in Japan.
However, the following year FDI shot up to over US$2 billion and
since 1995 the level of net foreign direct investment has increased
greatly every year. Figure 2.5 displays the level of net foreign
investment in Thailand between 1984 and 2000.
Net
flows of foreign direct investment in Thailand, by major countries,
1984-2000
Net
Flows of Foreign Direct Investment in Thailand, Classified by
Business
