Potential disparity between actual service experience and clients’ service quality expectations (Gap 5) and how this impacts foreign direct investment (FDI) inflows are investigated. Methodological triangulation encompassing quantitative and qualitative methods adopted. Contrary to quantitative findings, qualitative findings indicated that Gap 5 existed among the FDI clients. This is the first time service quality model (performance-based construct) is used to address FDI issues. It adopts “outside-in” mindset that uses perceived (actual) service as a reference point for client’s evaluation of service quality instead of the predominant “inside-out” mindset.