Abstract

With the economic rise of China, the issue of outward direct investment (ODI) in advanced economies by emerging countries has attracted widespread attention since the mid-2000s. Developing Asia accounts for nearly one-quarter of all ODI flows. Japan, Taiwan, South Korea and other ‘Asian tigers’ were all the pre-cursors of ODI from emerging economies in Europe and the USA after World War II. What is different today is the scale of the phenomenon and the pace at which it has evolved in just ten years, particularly from China. This chapter offers a review of the literature on ODI from East-Asian emerging economies. A discussion on the suitable theoretical background is proposed; old ‘mainstream’ theories are concisely and critically discussed in light of current insights drawn from the recent literature that could evolve eventually into a new or a substantially reformulated theory. Key words: emerging countries, foreign direct investment (FDI), FDI theory, Asia.