Critical Review on Competitiveness and FDI Inflow: A Study on the Indonesian Oil and Gas Industry

Abstract

The objective of this study is to identify and analyse the determinant factors of Indonesian oil and gas foreign direct investment (FDI) and its impacts on the Indonesian competitiveness. The flow of FDI in oil and gas has been increased dramatically in the last five years. However, the distribution of FDI is highly unequal and the competition among countries to attract foreign investors is fairly high. This study is based on quantitative survey of 245 samples from employee that worked in foreign oil and gas companies in Indonesia. Descriptive analysis was presented to explore the overall performance of country competitiveness, as well as the relationship among variables. The finding of this study showed that government, infrastructure, location and human resources have a very strong influence on the Indonesian competitiveness.

Keywords: FDI, Competitiveness, Oil and Gas, Indonesia

JEL Classification: L1