Global Britain, Belt and Road Initiative, and New Southbound Policy: Which One Matters to Southeast Asia?

In anticipation of the impending memberships of China, the UK, and Taiwan in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), this paper analyses the three economies’ foreign direct investment (FDI) flows entering the region over the last 20 years. Several findings are noteworthy. Firstly, the UK outinvested China and Taiwan between 1995 and 2008. However, its preponderance has been trimmed in the years after the 2008 global financial crisis. Secondly, UK FDI is largely geared towards Singapore and Malaysia, suggesting the resilience of former colonial ties. FDI from China predominantly enters its immediate neighbours (e.g., Laos, Myanmar, and Cambodia) and those sharing sociopolitical similarities with it (i.e., Singapore and Indonesia). Taiwanese firms invested relatively more in Vietnam and the Philippines, which are adjacent to Taiwan. Thirdly, all three FDI donors invested mostly in the tertiary sector. Nevertheless, relative to China, the UK and Taiwan channelled more of their FDI towards manufacturing activities. The findings could provide essential evidence to understand or anticipate which economy will play a more significant role in the region’s political and economic affairs especially when their CPTPP membership is ratified.