TRADE AND FOREIGN-INVESTMENT IN EAST AND SOUTHEAST-ASIA

This article provides a preliminary analysis of some recent data on tr ade and foreign direct investment (FDI) in East and Southeast Asia (ES EA). It also attempts a brief review and synthesis of some recent theo retical research on trade, FDI and growth in the ESEA context. The art icle suggests both theoretical underpinnings and preliminary empirical evidence in favour of the possible presence of a ''virtuous growth cy cle'' whereby trade expansion, FDI and growth interact closely and sus tain one another in ESEA. The article also draws attention to the uniq ue dynamics of ESEA trade and FDI, where individual countries continuo usly upgrade their exports and constantly transform themselves from re cipients of inward FDI to providers of outward FDI as they go through the growth cycle. Preliminary data in the article cast doubt on the hy pothesis that ESEA manufactures' export may have had a substantial adv erse impact on the labour market in their major industrial-country tra de partners. Finally, the article suggests close links between FDI, tr ade and regional integration that may have served to enhance growth pe rformance across ESEA countries.