Foreign Direct Investment ( Fdi ) Essay

Foreign Direct Investment ( Fdi ) Essay

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Foreign Direct Investment ( FDI) is a source that a country obtain from other countries in order to add value for it’s own economy. These sources can be various: Economic or technological. Foreign Investors may establish a new facility or open their branch or establish a partnership with a local company in host country. Nowadays, there is more demand of FDI’s than the world trade and world output. This drastic rise in FDI is due to the help of changing potentials and economic policies that are happening in the developing countries worldwide (Alesina and Dollar, 2000).Investors are more likely to invest their money on more profitable places,it would not be reasonable for companies to invest on less profitable countries. Moreover, the key point for a company is transferability of their profit to their own country. If they can not transfer the profit that they earn in foreign country , then they avoid to invest in that country. Besides profitability and transfer of profitability, there are some other reasons that affect FDI and decision of foreign investors. These are economic, political and moral. Initially these factors ensure the profitability and persistence of investment. This paper will aim to analysis why some countries attract more FDI and what can be done to bring foreign investments to a country.
Today,It can be said that attractivenes of a market is the most prominent factor that affect investor’s decision. The demand in host country for the product encourages the FDI. Because the income from investmens depend on the size and capacity of market.Another key factor is the abundance and cheapness of natural resources . Countiries which are rich in terms of underground and overground sources and have oil such a...


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...cuses on getting an interest by a resident of one country in an organization that is located in some other country (Dunning and Pitelis, 2007). Competitions has not merely occured between companions, countries are eachother’s rival anymore. Competitive advantage is built and continued through a highly localized process. Differences in national values , culture , economic structures, institutes and histories all contribute to competitive success. There are many differences on the patterns of competitiveness in every country;no nation can or will be competitive in every industries. Ultimately, nations succeed in particular industries since their home environment is the most forwar-looking , dynamic and challenging. ( Porter, 1990 ) All in all, with all these competitive advances, a country is well attracted by investors for FDI (Daniels, Radebaugh and Sullivan, 2007).

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Foreign Direct Investment ( Fdi ) Essay

- Foreign Direct Investment ( FDI) is a source that a country obtain from other countries in order to add value for it’s own economy. These sources can be various: Economic or technological. Foreign Investors may establish a new facility or open their branch or establish a partnership with a local company in host country. Nowadays, there is more demand of FDI’s than the world trade and world output. This drastic rise in FDI is due to the help of changing potentials and economic policies that are happening in the developing countries worldwide (Alesina and Dollar, 2000).Investors are more likely to invest their money on more profitable places,it would not be reasonable for companies to inve...   [tags: Investment, Foreign direct investment]

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