Explore BrainMass

What is FDI

The solution gives common descriptions of FDI and some references where related materials can be found.

Solution Preview

What is FDI?

1. Foreign direct investment

2. The purchase by the citizens of one country of non-financial assets in another country. Foreign direct investment involves the acquisition or establishment of a firm, company or enterprise in a country outside of the registered corporate home.

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

4. According to the IMF and OECD definitions, direct investment reflects the aim of obtaining a lasting interest by a resident entity of one economy (direct investor) in an enterprise that is resident in another economy (the direct investment enterprise). The "lasting interest" implies the existence of a long-term relationship between the direct investor and the direct investment enterprise and a significant degree of influence on the management of the latter. Direct ...