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Risks and foreign direct investment inflows: Evidence from Yemen


Al-Jaifi, Hamdan Amer Ali and Abdullah, Nur Adiana Hiau and Regupathi, Angappan (2016) Risks and foreign direct investment inflows: Evidence from Yemen. Jurnal Pengurusan, 46. pp. 89-97. ISSN 0127-2713

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Abstract

This study aims to find the relationship between the political, exchange rate and inflation risk factors with the Yearly Foreign Direct Investment (YFDI) in Yemen, over the period between 1990 to 2010. Secondary data results showed that political risk and exchange rate risk have an inverse relationship with YFDI, while inflation risk has a significant positive relationship.Further analysis on a survey collected from 62 multinational enterprises (MNEs) operating in Yemen showed an insignificant relationship between the perceived political, exchange rate and inflation risk factors and corporate foreign direct investment (CFDI).The conflicting results possibly imply that the MNEs' subsequent capital investments may not be affected by the perceived political, exchange rate and inflation risks that would nonetheless have been considered during the initial business plan.It is likely that MNEs that were already operating in Yemen may have developed capabilities in terms of knowledge, bargaining and lobbying skills.Therefore, perceived risks are no longer seem to influence their investment decisions.

Item Type: Article
Additional Information: Malay title = Risiko dan pelaburan langsung asing: Bukti dari Yaman
Uncontrolled Keywords: Foreign direct investment; political risk; exchange rate risk; inflation risk; multinational enterprises
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Divisions: School of Economics, Finance & Banking
Depositing User: Prof. Dr. Nur Adiana Hiau Abdullah
Date Deposited: 13 Nov 2016 01:42
Last Modified: 13 Nov 2016 01:42
URI: http://repo.uum.edu.my/id/eprint/19197

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