Country’s FDI Patterns and Investment Potentials
Overview and Thoughts
Foreign direct investment (FDI) , which is the process of investment by organization directly to produce in a foreign country, results in the transfer of value from one country to another. This can lead to direct impact and investment on infrastructure, employment, income, accumulation of assets and knowledge, and overall economic growth. It is like someone (investor) bringing their money and equipment to your farm and handing it to you to help you produce more in exchange for a share of your crops. In theory, both you and the investor benefit. You get to increase your production and maybe employ your children and family members, and the investor gets crops without doing the job. So, it is a win-win situation.
But it is not that simple. The level of FDI flow into the country depends on two main factors: First, the level of governmental restriction and facilitation to foreign direct investment, and second, the perceived profitability of the country, which depends on the cost of production, resources, laws, level of political stability, and level of economic growth.
So, a foreign investor needs to investigate the country’s attitude, laws, regulations, and predicted return to investment before making an investment decision. This is what you will do in this report, which is to help an organization choose a country to open a factory there.
Assignment Description
A manufacturing company that is located in your home country has approached you and asked you to help them choose a country to build a factory there. Your job is to pick a country, evaluate its pattern of FDI in the past 10 or 20 years, state which industry attracts the most FDI in that country and why, what type of FDI (manufacturing, high tech, finance, etc.) is most profitable in that country, then provide a recommendation on what type of manufacturing output that country is most suitable for and why.
The following are useful sources for obtaining FDI data by country and industry.
FDI Sources
To review these sources, copy and paste the following links into a new web browser.
Writing Style (APA) and Page Number Requirements
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Font Type: Times New Roman or Arial
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Font Size: 12
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Spacing: Double
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Number of Pages: Two to three pages, not counting the separate Title page and the separate References page.
Content Structure and Requirements
· Title Page
· Title of the paper (your choice)
· Name of the author (your name)
· Email address of the author
· Class name
· Professor’s name
· Date
· Content Structure
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Introduction:
· Briefly state the name of the country that you have selected, its population size, its total income (GDP), and its top manufacturing sector.
· State the size of FDI in that country as of 2022, 2021, or 2020 (whichever is available).
· State the type of industry that is most prosperous in that country which has potential gain for FDI.
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FDI and Industry Data & Analysis:
· Use graphs, data, or tables to show the flow of FDI over time in your selected country, and then discuss the sources of growth or decline in FDI flow.
· Use data, graphs, or facts to explain the main manufacturing sectors that are funded by FDI in that country.
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Recommendations:
· State your final recommendation: Should the manufacturing company build a factory in the country that you have selected?
· State the reasons for why the company should (or should not) move to that country.
· State what is the most suitable industry or manufacturing sector for FDI in that country.
Reference List
· Use two to three credible sources to support your argument
· Cite any sources used. The references need to be in APA format
