Besides that, exchange rate serves as prominent indicator towards FDI outflow
(Kohlhagen, 1977; Stevens, 1993; Gopinath et al., 1998; Kyrkilis and Pantelidis,
2003). Their findings implied significant association between home country exchange
rate and FDI outflow. Appreciation of currencies enables home country firms to
conduct abroad investment due to the ability to mitigate the capital requirement. On
the other hand, depreciation of the currencies indicates higher cost of abroad
investment and therefore will hinder domestic firms to participate in oversea
investment