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 ?
The central bank defines foreign direct investments as actual inflows from overseas, which could be in the form of equity capital, reinvestment of earnings or borrowings between affiliates.
The proposed Regulation on screening of foreign direct investments into the EU needs the approval of the European Parliament and EU Member States in the Council (ordinary legislative procedure).
The report also pointed out that the incoming foreign direct investments to the Arab world last year comprised 1.
According the survey, the foreign direct investments in water, electricity, gas and recycling jumped from Dh8.
According to the National Bank, 157 million euros in foreign direct investments entered the country last year, 205 million euros in 2014, and 252 million euros in 2013.
In late 2014, the Department of Commerce Bureau of Economic Analysis (BEA) re-instated the Mandatory Reporting Requirements for New Foreign Direct Investment in the United States (BE-13).
Significant increase in foreign direct investments, on the contrary, is observed from Belarus - $56.
The increase in foreign direct investment to $6bn represents a 100% increase over FY 2012/2013 investments, which were valued at $3bn only.
1) According to preliminary data, foreign direct investment in the United States in 2013 is estimated at $147 billion, a drop of 11% from the amount invested in 2012.
The foreign direct investments are very important to Central, Eastern and Southeastern Europe.
ANKARA, Jul 14, 2011 (TUR) -- Turkey's newly appointed economy minister said on Thursday that flow of foreign direct investment in Turkey reached 5.
According to the "Prospects for FDI -2011," report released recently by the "Foundation & Financial Times", the total number of foreign direct investment projects for the year 2010 is about 12.

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