Professional Documents
Culture Documents
Foreign direct investment (FDI) refers to long term participation by country A into country B. It usually
involves participation in management, joint-venture, transfer of technology and "know-how". There are
two types of FDI: inward foreign direct investment and outward foreign direct investment, resulting in
a net FDI inflow (positive or negative).
Contents
[hide]
• 1 History
• 2 Types
• 3 Methods
countries
• 7 References
• 8 External links
[edit]History
Foreign direct investment (FDI) is a measure of foreign ownership of productive assets, such as factories,
mines and land. Increasing foreign investment can be used as one measure of growing economic
globalization. Figure below shows net inflows of foreign direct investment as a percentage of gross
domestic product (GDP). The largest flows of foreign investment occur between the industrialized
countries (North America, Western Europe and Japan). But flows to non-industrialized countries are
increasing sharply.
[edit]Types
A foreign direct investor may be classified in any sector of the economy and could be any one of the
following:[citation needed]
an individual;
a group of related individuals;
an incorporated or unincorporated entity;
a public company or private company;
a group of related enterprises;
a government body;
an estate (law), trust or other societal organisation; or
any combination of the above.
[edit]Methods
The foreign direct investor may acquire 10% or more of the voting power of an enterprise in an economy
through any of the following methods:
Foreign direct investment incentives may take the following forms:[citation needed]