Determinants of foreign direct investment in Cambodia

This paper analyses the determinants of the factors that might influence inward FDI in Cambodia by referring to its economic, geographic, and political characteristics. Using exclusive unbalanced panel data sets during 1995-2005, for both approved and realized FDI for, respectively, seventeen and fifteen home countries, the estimation results show that the determinants of approved FDI and realized FDI are somewhat similar. The FDI home country's GDP, its bilateral trade with the host country and the exchange rate have a positive impact on inward FDI flows into Cambodia. As expected, geographic distance negatively affects the level of FDI inflows in Cambodia.