International Journal of Management and Sustainability, 2014, 3(2): 72-83 72 FOREIGN DIRECT INVESTMENT AFFLUENCES IN ISKANDAR MALAYSIA Patmawati Ibrahim Senior lecturer, Faculty of Technology Management and Business, Universiti Tun Hussein Onn Malaysia Batu Pahat, Johor, Malaysia Maimunah Ali Senior lecturer, Faculty of Technology Management and Business, Universiti Tun Hussein Onn Malaysia BatuPahat, Johor, Malaysia ABSTRACT Iskandar Malaysia is one of the regional economic growth areas that have been identified by the government of Malaysia to spearhead economic transformation programmes as stipulated in the Tenth Malaysia Plan. The aims of the economic transformation programmes are to address the declining trend in foreign investment and outflow of human capital, as well as to spur the next stage of economic development. Thus, Iskandar Malaysia serves as the platform to highlight Malaysia’s structural shift to broader macro objectives that aims to transform Malaysia into a developed nation by a knowledge-based economy. Since its inception in 2006, Iskandar Malaysia has attracted foreign investments of about RM111.4 billion as of the first quarter of 2013 and 40% of the investments has already been realised. The entry of heavyweights foreign investors such as Temasek, Ascendas, CapitaLand, China’s Country Garden and Australia’ Walker Corp have propelled foreign direct investment (FDI) flows into Iskandar Malaysia, making it highly dependent on foreign funds for development. Although FDI is the key catalytic agent of economic growth and development, it is not without pitfalls and setbacks, especially on local community and average households in Johore. The aim of this paper therefore, is to examine the affluences and setbacks of FDI in Iskandar Malaysia on average local households across the five flagship zones of Iskandar. The study would include analysing the impact of FDI on culture and social-economic environments as well as on natural surroundings in the Iskandar area, and subsequently, attempts to touch on the sustainability of FDI in maintaining rapid economic progress of Iskandar Malaysia. © 2014 Pak Publishing Group. All Rights Reserved. Keywords: Malaysia, Iskandar region, FDI, Economy, Transformation, Johore. JEL Classification: O11, E22, R58 International Journal of Management and Sustainability Special Issue: Economic, Finance and Management outlooks journal homepage: http://pakinsight.com/?ic=journal&journal=11