FDI basics
This term describes investment made by a company in one country into business operations in another country.
FDI
FDI brings this essential financial resource into a country, supporting investment and growth.
Capital inflow
Larger economies attract FDI because of this factor related to demand size.
Market size
Environmental damage and poor working conditions are examples of these concerns related to FDI.
Environmental and labor issues
This country used FDI to become a global manufacturing and export powerhouse.
China
According to the World Bank, FDI requires at least this percentage of voting stock to indicate lasting interest.
10%
Clue: This benefit of FDI refers to sharing advanced production methods and innovations.
Technology transfer
Countries with cheaper workforce often attract FDI due to this cost advantage.
Low labor costs
Over-reliance on foreign investment instead of domestic development is called this.
Dependence on foreign capital
This small country is known for attracting high-quality FDI due to strong institutions and skilled labor.
Singapore
This type of FDI involves building new facilities from scratch in a foreign country.
Greenfield investment
FDI improves this by increasing output per worker through efficiency and knowledge spillovers.
Productivity
Reliable transport, energy, and communication systems are referred to as this.
Infrastructure
Clue: This occurs when foreign firms push domestic companies out of the market.
Crowding out
This Southeast Asian country is often cited for successful export-oriented FDI in manufacturing.
Vietnam
This type of FDI occurs when a firm buys or merges with an existing foreign company.
Mergers and acquisitions?
This effect happens when domestic firms learn from multinational companies and improve performance.
Spillover effects
Stable governments and predictable policies fall under this key investment condition.
Political stability
Clue: When foreign companies send profits back to their home country, it is called this.
Profit repatriation
Developed economies mainly attract FDI in this sector, including finance and advanced services.
High-tech and service sectors
This form of FDI occurs when firms at different stages of production invest abroad to control supply chains
Vertical FDI
This concept describes how well a country can absorb and use foreign knowledge and technology.
Absorptive capacity
Strong legal systems, property rights, and governance quality are collectively known as this.
Institutions
This situation occurs when FDI operates in isolation without benefiting the local economy.
Enclave development
This international organization tracks global FDI trends and publishes the World Investment Report.
UNCTAD