Although the ASEAN region as a whole was the primary
destination for Thai outward FDI, the interest of Thai
enterprises in investing in China grew rapidly. Geographical
proximity and cultural affinity, along with regional
integration (i.e. the creation of AFTA) and the aspiration
of Thai firms to be more regionally present, played a role
in influencing the geographical concentration of Thai FDI.
The cost advantage and large market size, including
investment and business opportunities in China and other
ASEAN countries, contributed to the growing interest of
Thai firms to invest or to be present in these host countries.
In particular, low cost ASEAN countries (Cambodia, Lao
PDR, Myanmar and Viet Nam) attracted a significant amount of attention from Thai enterprises (table 2; NESDB
and UN, 2004, p.55). Thailand is an important source of
FDI for these neighboring countries.