Significance of study

This study provides evidence that foreign direct investment is

positively related to economic growth as has been proven by many
economists. Foreign direct investment helps economic growth and
increase the society welfare. Foreign direct investment brings advantages
and disadvantages to the economy of Malaysia. The disadvantages of
foreign direct investment are there will be much too foreign ownership,
adverse effects on balance of payment, and differences in culture and
language. The adverse effects of foreign direct investment could influence
economic growth and domestic development in Malaysia.
It brings problems to the countries if the countries over rely on
foreign fund to develop their own country economy especially the
economic turn downs and facing budget deficits. Bank Negara Malaysia
(BNM) could implement monetary policy such as interest rate and
discount in loan. To raise foreign direct investment in country, the
government takes action such as by joining AFTA, NAFTA, and Look East
Policy. This study will be useful for other researchers and also for futher
or future generations of researchers. For Malaysia, it would be helpful for
government to make planning and making policy decisions.

Scope of study
The purpose of this study is to investigate how the foreign direct
investment gives impact to nation income in Malaysia. This study also
show how Malaysia deal with foreign direct investment in nation income
by policy such as AFTA, NAFTA, and Look East Policy. This study will be
covered around 30 years, which is start from year 1980 to year 2010. The
reference of this study is taken from the government websites that
provides statistics foreign direct investment from different country such
as, Ministry of Finance. By the data that collected in every year, shows
that which country have the highest investment in Malaysia. This study is
also based from the past research about relationship between nation
income and foreign direct investment.