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Impact of product-related environmental regulations in Asia: Descriptive statistics from a survey of firms in Penang, Malaysia

Discussion Papers

No.457

by Etsuyo Michida, Yasushi Ueki and Kaoru Nabeshima
March 2014

ABSTRACT

This paper summarizes the main results of a unique firm survey conducted in Penang, Malaysia in 2012 on product-related environmental regulations. The results show that firms receiving foreign-direct investment have adapted well to regulations but faced more rejections. Several research questions are addressed and examined by using the survey data. Major findings are as follows. First, adaptation involves changes in input procurement and market diversification, which potentially changes the structure of supply chains. Second, belonging to global supply chains is a key factor in compliance, but this requires firms to meet tougher customer requirements. Third, there is much room for government policy to play a role in assisting firms.


Keywords: global supply chain, FDI, product-related environmental regulation,REACH, RoHS
JEL classification: F18, O14

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