Locational choice strategy: How FDI's choice of Indonesia as an investment location towards competitiveness advantage

A. S. Wartaman, D. Kusumadewi, A. Ramadhani, R. D. Andajani

Research output: Contribution to journalConference articlepeer-review

Abstract

Globalization causes the world to appear flat without borders. Currently, business actors have the freedom to choose investment locations that can increase vantage for the company. This paper aimed to bring insight into Foreign Direct Investment (FDI)'s decision in relocating to Indonesia and the impact towards the company's performance. The research approaches are: 1) imitating referenced companies, and 2) supply chain as variables in the selection of investment destination. This study was done in quantitative method. The population of this study was FDI companies in Jababeka Industrial Area. Partial Least Squares-Structural Equation Modelling (PLS-SEM) was chosen in statistical data processing stage. This study concluded that (i) FDI is likely to ignore imitating approach in choosing Indonesia as investment location (ii) Supply chain becomes the main consideration of FDI in choosing Indonesia as investment destination, (iii) agglomeration of similar FDI is likely to benefit organizational competitiveness and (iv) FDI that choose Indonesia as investment destination using supply chain approach gains an advantage of higher organizational competitiveness.

Original languageEnglish
Article number012031
JournalIOP Conference Series: Earth and Environmental Science
Volume737
Issue number1
DOIs
Publication statusPublished - Apr 19 2021
Event5th International Seminar on Sustainable Urban Development, ISoSUD 2020 - Jakarta, Indonesia
Duration: Aug 5 2020 → …

All Science Journal Classification (ASJC) codes

  • Environmental Science(all)
  • Earth and Planetary Sciences(all)

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