Taiwanese investment in Southeast Asia

For the Go South policy in Taiwan, small- and medium-sized enterprises played an important role in the 1980s and 1990s. This is an exceptional case as theoretical predictions and empirical evidence, found in most countries, have indicated that foreign direct investment originated mainly from large firms. This paper examines the determinants and investment strategies of Taiwanese FDI in Southeast Asian countries. First, it reviews the evolution and current situations of Taiwan's investment and the economic rationales during the 1980s and 1990s. Then, it identifies three types of investment strategies: defensive investors, initiative investors, and institutional investors, and compares them in terms of their different economic rationales, investment patterns and networking activities.