foreign direct investment

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Foreign direct investment (FDI)

The acquisition abroad of physical assets such as plant and equipment, with operating control residing in the parent corporation.

Foreign Direct Investment

A major investment by a foreign corporation. A common example of foreign direct investment is a situation in which a foreign company comes into a country to build or buy a factory. Many economists believe that foreign direct investment is good for an economy, as it provides jobs and increases domestic capital. Critics point out that profits from foreign direct investment usually leave the country and go to the foreign company. Encouraging foreign direct investment is a major part of some IMF restructuring programs.

foreign direct investment (FDI)

investment by a MULTINATIONAL ENTERPRISE in establishing production, distribution or marketing facilities abroad. Sometimes foreign direct investment takes the form of GREENFIELD INVESTMENT with new factories, warehouses or offices being constructed overseas and new staff recruited. Alternatively, foreign direct investment can take the form of TAKEOVERS and MERGERS with other companies located abroad. Foreign direct investment differs from overseas portfolio investment by financial institutions which generally involves the purchase of small shareholdings in a large number of foreign companies.

FDI is used alongside STRATEGIC ALLIANCES and EXPORTING as an integral part of a multinational enterprise's FOREIGN MARKET SERVICING STRATEGY.

In 2003/2004, the USA was the world's leading outward (overseas) investor accounting for 15.5% of world outward FDI flows, followed by Belgium 13.3%, France 12.8%, the UK 12.7% and the Netherlands 5.8%. The USA was the leading recipient of inward FDI accounting for 17.3% of inward investment in 2003/2004, followed by Belgium 14.4%, Germany 9.7%, China 7.8% and the UK 7.1%.

foreign direct investment (FDI)

investment by a MULTINATIONAL COMPANY in establishing production, distribution or marketing facilities abroad. Sometimes foreign direct investment takes the form of GREENFIELD INVESTMENT, with new factories, warehouses or offices being constructed overseas and new staff recruited. Alternatively, foreign direct investment can take the form of TAKEOVERS and MERGERS with other companies located abroad.

Foreign direct investment differs from overseas portfolio investment by financial institutions, which generally involves the purchase of small shareholdings in a large number of foreign companies. See FOREIGN INVESTMENT for further discussion. See HOST COUNTRY, SOURCE COUNTRY, INVEST UK.

References in periodicals archive ?
Participants, both Tunisian and foreign experts, will present the new characteristics of the investment climate in Tunisia and the prospects provided in matters of attracting new direct foreign investments, economic development and job creation.
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Despite the annual increase, September 2012 had been critical when it came to direct foreign investments with an exodus of EUR 167 M attributed to payments of debts to parent companies, the Bulgarian "Sega" (Now) daily writes.
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To date, Turkey has earned 40 billion USD from privatizations and attracted 80 billion USD worth direct foreign investments, Gul said.
Director of the Syrian Investment Agency Ahmad Abdelaziz underlined the importance of the survey due to the role of direct foreign investments in the GDP and providing job opportunities, pointing out that foreign investment in Syria in 2008 amounted to USD 1.
Summary: Tunisia has managed in 2008 to achieve rather encouraging results in matters of attracting direct foreign investments (DFI).
A complex plan on attraction of direct foreign investments was presented at the Government sitting, Deputy Prime Minister of Kazakhstan, said Minister of Industry and New Technologies Asset Issekeshev during the media briefing on the results on the Government session.
KUWAIT, April 8 (KUNA) -- Kuwait has completed plans to form an authority tasked with encouraging direct foreign investments, a minister said on Monday.
According to preliminary data, direct foreign investments in the country for the January-August period of 2011 are estimated at EUR 225.

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