ASEAN Economic Community 2025and Foreign Direct Investment ASEAN Investment Report2024 ASEAN Economic Community 2025and Foreign Direct Investment The ASEAN Secretariat The Association of Southeast Asian Nations (ASEAN) was established on 8 August 1967. The MemberStates are Brunei Darussalam, Cambodia, Indonesia, the Lao People’s Democratic Republic, Malaysia,Myanmar, the Philippines, Singapore, Thailand and Viet Nam. The ASEAN Secretariat is based in Jakarta, Indonesia. For inquiries, contact: The ASEAN SecretariatCommunity Relations Division (CRD)70A Jalan SisingamangarajaJakarta 12110, IndonesiaPhone: (62 21) 724-3372, 726-2991Fax: (62 21) 739-8234, 724-3504E-mail: public@asean.org Catalogue-in-Publication Data ASEAN Investment Report 2024 - ASEAN Economic Community 2025 and Foreign Direct InvestmentJakarta: ASEAN Secretariat, October 2024 332.673951. ASEAN – Investment – Foreign Direct Investment2. ASEAN Economic Community 2025 – Policy ASEAN: A Community of Opportunities for All The text of this publication may be freely quoted or reprinted, provided proper acknowledgement isgiven and a copy containing the reprinted material is sent to Community Relations Division (CRD) of theASEAN Secretariat, Jakarta. General information on ASEAN appears online at the ASEAN Website: www.asean.org Copyright Association of Southeast Asian Nations (ASEAN) 2024.All rights reserved. This publication was prepared by the ASEAN Secretariat and the United Nations Trade and Development(UNCTAD), and supported by the Government of Australia through the Australia for ASEAN Futures Initiative(Aus4ASEAN Futures). The map in this publication is only indicative and is not drawn to scale. Disclaimer The ASEAN Investment Report is produced to facilitate a better understanding of FDI developments inASEAN. The findings, interpretations, and analysis in the Report should be treated with care, as work onharmonising and improving FDI quality across the region is on-going. The ASEAN Secretariat and UNCTAD have taken due diligence in the preparation of this publication.However, it shall not be held liable for any omissions or inaccuracies in the content of this publication.Neither the ASEAN Secretariat, UNCTAD and the Government of Australia accepts any liability for anyclaims, loss or expenses that may arise or arising from use of information in this publication. Reliance onthe information is at the user’s sole risk/responsibility. FOREWORD In an era marked by shifting global economic dynamics, including the redirection of investmentflows and the diversification of supply chains to mitigate geopolitical risks, ASEAN hasconsistently proven its resilience and appeal as a leading destination for Foreign DirectInvestment (FDI). For three consecutive years, ASEAN has maintained its position at the topof FDI recipients among developing regions. In 2023, FDI inflows to ASEAN reached anotherhistorical level of US$230 billion, despite an overall decline in global FDI flows. The shifting patterns and priorities in global FDI, particularly the growing focus on digital andgreen technologies, are also strongly manifest in the region. Major international investmenttrends in 2023 underscored ASEAN’s rising prominence as as a global hub for financial anddigital services as well as manufacturing. This is evident from the increasing investor interest inthese sectors as well as robust investments in renewable energy (RE), electric vehicle (EV), anddigital economy in recent years. Over the past decade, the FDI from Multi-National Enterprises(MNEs)in the manufacturing sector has significantly advanced the region’s economicintegration, technology upgrading, and sustainability agenda. All these developments and trends are reflected in the ASEAN Investment Report 2024. Arrivingat a critical moment as the ASEAN Economic Community (AEC) 2025 Blueprint approaches its finalyear of implementation, the Report provides a thorough assessment of the shifting investmentlandscape within ASEAN in the past decade. It highlights the substantial growth of FDI performancein the region during this period, along with key regional policy developments that have driventhis progress. It also identifies areas where overall intra-ASEAN investment can still be improved. Going forward, this Report presents specific policy recommendations for the post-2025period. It emphasises the need to address existing implementation gaps and tackle issuesaffecting the regional investment climate in various domains, including trade, services, digital,public-private partnerships, skills and technology. Additionally, the Report underscores theimportance of enhancing the alignment between the AEC and the Sustainable DevelopmentGoals (SDGs), including the focus on gender development and inclusivity. As the global economy continues to evolve with potentially more disruptions and uncertainties,ASEAN stands ready to maintain and enhance the region’s attractiveness as a single FDI destinat