Asian Economic and Financial Review

Analyzing the governance-FDI nexus in Southeast Asia: An EGLS-SUR panel analysis

Pahlaj Moolio — 2026-03-12

Economic and institutional factors influence foreign direct investment (FDI) inflows. To address limitations in previous regional research, this study uses a balanced panel dataset spanning 19 years across all ten ASEAN member states. Employing a panel EGLS (cross-sectional SUR) methodology, we evaluate all six Worldwide Governance Indicators (WGI), both aggregated and disaggregated, alongside five macroeconomic controls: economic growth, exchange rate, financial development, unemployment, and human development. Results indicate that while aggregate governance significantly influences FDI, individual WGI dimensions are heterogeneous. Specifically, voice and accountability, rule of law, and control of corruption consistently exert positive effects, whereas other dimensions are inconsistent or unexpectedly negative. All control variables remain significant, aligning with theoretical frameworks. This study contributes through its full regional coverage and detailed analysis of governance dimensions, providing a clearer understanding of investment behaviors. The findings offer important policy implications: achieving sustainable economic growth via FDI requires targeted improvements in specific governance dimensions rather than broad institutional changes.

Islamic credit card in Malaysia based on maqasid al-shariah: Evaluation from a wealth perspective

Mirzan Mohideen Bathusha — 2026-04-27

The analysis focuses on the substantive structure of the Islamic Credit Card (ICC) in light of maqasid al‑shariah, with emphasis on the dimension of wealth. The study adopted a qualitative research design, with data collected through both primary and secondary sources. The primary data comprised semi-structured interviews with six experts, while the secondary data included Qur’anic verses, Prophetic narrations, and scholarly journal articles. Thematic analysis was conducted using NVivo version 15 to extract relevant themes. Applying the rafʿ al‑ḥaraj framework, the findings reveal that the Islamic Credit Card (ICC) facility aligns with the objectives of maqasid al‑shariah, which seek to promote maslahah (benefit) and eliminate mafsadah (harm). Moreover, the analysis underscores that beyond technical compliance, the ICC structure embodies substantive alignment with shariah principles by reducing hardship, facilitating human welfare, and ensuring ethical transparency in consumer credit. The study further highlights that the ICC provides greater financial accessibility, enabling consumers to manage liquidity needs without compromising ethical principles. By embedding safeguards against harm, the ICC promotes responsible consumption and supports cardholders in achieving maqasid al-shariah realization. Ultimately, the study offers essential guidance for stakeholders, particularly regulators, in shaping directions that align with cardholders' interests: to safeguard systemic stability and to empower individuals with the extensive knowledge necessary to make ethical, informed financial decisions.

Determinants of bank stability in an emerging market: A dynamic panel evidence from Nigeria

Fasiu Idowu Adesina — 2026-04-27

Banks are a key driver of economic activities, especially in emerging markets, where capital markets are not well developed. Thus, this study examines the factors that determine the stability of banking in an emerging market. We have employed the fixed-effects and dynamic System-GMM techniques to analyze panel data collected from the annual reports of the banks, the bulletin of the Central Bank of Nigeria (CBN), and the World Bank database from 2014-2023. These estimators address heterogeneity, measurement error, endogeneity, and unobserved biases. The results indicate that capital adequacy ratios, liquidity ratios, efficiency, bank size, quality of governance, and profitability are important in enhancing bank stability in Nigeria. Although past stability has a positive influence on present stability, GDP growth has a positive but statistically insignificant effect on resilience. Bank stability is adversely impacted by non-performing loans, inflation, the quality of institutions, and interest rates. These findings suggest that banks should be regulated on bank-specific variables, including non-performing loans. The Central Bank should further strengthen its control over the Nigerian banking industry to foster resilience and sustainability. Policymakers should improve the level of governance and policies that promote stability.