Study On R&D Investment By TNCs In ASEAN 5

With the development of economic globalization, TNCs' R&D is internationalizing. TNCs' strategic objective of R&D is to establish its R&D network around the world and R&D internationalization has become a significant part of the TNCs' global strategy. In recent years, ASEAN 5 (Indonesia, Malaysia, Philippines, Singapore and Thailand) are participating in the process of R&D internationalization and becoming the host countries of TNCs' R&D activities. As TNCs are the dominant players in the creation of new technologies, ASEAN 5 are quite aware that R&D investment will promote the economic and technological development, so they are taking measures to attract foreign R&D affiliates.ASEAN 5 have recently attracted innovative R&D centers from a variety of TNCs, but diverse levels of economy and technology determine the different position of them in the process of R&D internationalization. ASEAN 5 have been remarkably benefiting from technology transfers, diffusions and knowledge spillovers. Nowadays, China is actively attracting R&D investment of TNCs, so she can use the experience of ASEAN 5 for reference.This paper summarizes the theories of R&D internationalization and the factors that drive TNCs to set up R&D centers in ASEAN 5. It then describes the actuality and characters of R&D investment by TNCs in detail. Finally, the paper analyses the effects of TNCs' R&D activities, summarizes all the measures taken by ASEAN 5 and discusses the Chinese countermeasures on the basis of ASEAN 5's experience.