The announcement of foreign direct investment (FDI) projects in Southeast Asia is on an upward trend in 2025. However, project announcements and funding always have a lag. In some cases, the fulfillment of investments will be delayed due to market uncertainty caused by the ever-changing global tariff policies.
The United States remains a top investor in the region and has continued its commitment to strengthening political and defense relations.
Malaysia
The Malaysia Investment Development Authority (MIDA) announced that the first half of fiscal year 2024 resulted in $19 billion for FDI projects, representing a 40% increase from the previous year. Significant investments in the electrical and electronics sector, semiconductors, and broader manufacturing industries drove the strong results.
In 2024, U.S. companies made significant investments in Malaysia, totaling at least $7.4 billion in approved projects, with additional billions in announced technology initiatives. The semiconductor sector was particularly active, featuring companies like Intel, GlobalFoundries, Texas Instruments, and Micron.
Data and cloud center investments by global tech giants: Companies like Amazon ($6.2 billion), Nvidia ($4.3 billion), Google ($2 billion), and Microsoft ($2.2 billion) have previously committed to building data centers in Malaysia, with some projects still in the implementation phase.
Hyundai Motor announced its plan to invest nearly $480 million in Malaysia over the next five years from 2025 to enhance its production capacity. The South Korean automaker stated it would collaborate with its local partner, Inokom Corp., to upgrade its complete knockdown unit assembly plant, which currently produces the older-generation Santa Fe SUV model.
The Singaporean and Malaysian governments signed a formal agreement to establish the Johor-Singapore Special Economic Zone on a land mass equivalent to the size of Rhode Island in an area just across from the Singapore Straits. The area is expected to draw substantial foreign investment in the manufacturing sectors of electrical and electronics, semiconductors, aerospace, medical devices, and automotive components.
Thailand
In January and February 2025, Thailand approved 181 foreign investment cases, a 68% increase compared to the same period last year. The total investment value for these approvals reached approximately $1 billion, up 33% from the previous year. The consensus forecast for all of fiscal year 2025 is that FDI in Thailand will reach $30 billion, driven by investments in sectors like data centers, cloud services, electric vehicles (EVs), hybrid vehicles, and semiconductors.
Mazda Motor Corp. announced that the company will invest an additional $150 million in the country to establish Thailand as the manufacturing hub of its electrified compact SUV product line for sales in the domestic as well as export markets.
The Thailand Board of Investment approved a $1-billion investment from China-based Sunwoda Electronic to build an EV battery plant.
Delta Electronics announced a $500-million investment in Thailand over four years. Delta plays a key role in the electronics supply chain, producing power management systems, components, and solutions that support industries like semiconductors, EVs, and data centers. This investment aligns with Thailand's strategic vision to bolster its automotive industry and digital economy, particularly in the EV sector.
Vestergaard Company Holding will invest $75 million to expand its current production of ground support equipment for the aviation industry.
Vietnam
Vietnam saw a significant influx of FDI in early 2025. Data from its Ministry of Planning and Investment indicates that $4.3 billion in foreign investment was announced in January 2025 alone, a 48.6% increase compared to the same period in 2024. Manufacturing continues to be a top sector for FDI.
Vietnam is strongly courting U.S. investment as it endeavors to show the current U.S. government leadership that it aims to level the trade balance. At $124 billion, Vietnam has the fourth-largest trade surplus with the United States, behind China, the EU, and Mexico.
Samsung Display, a subsidiary of Samsung Electronics, announced plans to invest $1.8 billion in a new OLED manufacturing facility in northern Vietnam. This investment would increase Samsung's total commitment in Vietnam to $22.4 billion, reinforcing its significant manufacturing footprint, which includes six plants, a research and development center, and a sales entity.
VinFast, Vietnam’s homegrown automotive company, announced plans to build a second production plant in Ha Tinh province. This facility is designed to double the company’s domestic production capacity to 600,000 units annually. The plant will primarily focus on producing smaller and mid-sized models like the VF 3 and VF 5 for both domestic sales and export.
Tier 1 automotive suppliers already operating in Vietnam will also likely increase capacity. Those include Bosch, Denso, Magna International, Continental, and Valeo. Other Tier 1 suppliers like Apriv, ZF, and Faurecia are considering partnerships or establishing their own manufacturing operations.
Dentium of Seoul, South Korea, will invest $177 million to manufacture dental implant systems in Vietnam.
Trelleborg Sealing Solutions, a global leader in developing, manufacturing, and supplying precision sealing solutions, is investing $85 million in a second manufacturing facility in Vietnam. A state-of-the-art manufacturing facility will be built in Ba Ria Vung Tau, near Ho Chi Minh City.
Kitz Corp. will invest $88 million to establish a new factory on the premises of its subsidiary in Vietnam. The factory will produce high-purity gas-compatible valves for the semiconductor equipment market and aims to be in production by November 2025.
For more information, please contact Mike Lauer at mlauer@AMTonline.org.
