Issue FDI dominance coexists with sharply volatile portfolio and bank-related flows

Summary

The capital picture for the six Southeast Asian growth markets has two contrasting sides. Foreign direct investment is the dominant channel, supplying more than 70 percent of total foreign inflows between 2021 and 2024. Mergers and acquisitions, another key route for foreign money, have held steady in deal count, with Malaysia and Indonesia generating the largest shares. By contrast, portfolio flows and bank-related and other inflows have swung sharply over the past decade. The stable headline therefore sits on top of a volatile remainder, and it is these non-FDI components that explain most of the year-to-year movement in total inflows.