Political Economist

Diaspora FDI
FDI in emerging Market
Emerging Market
-information scarce
-youll need social network/ties to be able to invest (friends, cousins, relatives)

Study Objectives:
-ASEAN 2015 :strategies and expectations
-social ties in business
-role of migrants in facilitating FDI(roles as owners & managers)

Labor Intensive
-302 firms :237 foreign-owned located in Manila and CALABARZON
-40-minutes face-to-face interviews
-demographics, strategy, performance

Optimism and Preparedness

-exposure: business in other ASEAN countries
-capabilities: more productive firms

What Highly productive firms think about ASEAN:

- 2/3 expect to benefit from this

ASEAN Preparedness (not having productive steps to strategze even if they find this
important )
-interviewed managers/owners who have the knowledge of firms strategies

-46% of firms mention ASEAN 2015 when asked about important coming changes to
the business climate
-1/2 of firms have done nothing to prepare including 1/3 of firms that mentioned
ASEAN 2015 as important
-exposure drives optimism

DIASPORA THEORY
-migrants and their descendants (retain social and emotional ties to the homeland)
-social networks and information
-social and emotional motivations for investment

Accesing Network Importance

-family relationships
-real eastate

Liability of Foreignness
PH Preliminary results
-40% of foreign firms are migrant-owned ; 60%
are migrant affiliated
-migrant-affiliated firms are more connected to politicians and more likely to
attempt to influence policy

AEC promotes free flow of goods, services, FDIs. Given this, It can
be more prone to tax evasion since you can freely transfer
are there anti-tax evasion measures within ASEAN regional level (something like Us
FATCA)

and are the firms aware of them?

Benjamin.a.graham@usc.edu