The effect of exchange rate volatility on manufacturing foreign direct investment (original) (raw)
Related papers
Foreign Direct Investment in the World Economy
IMF Working Papers, 1995
This is a Working Paper and the author(s) would welcome any comments on the present text. Citations should refer to a Working Paper of the International Monetary Fund, mentioning the author(s), and the date of issuance. The views expressed are those of the author(s) and do not necessarily represent those of the Fund.
WSEAS transactions on environment and development, 2022
Foreign Direct Investment plays an important role in a country's economic activity because of its positive effect on economic growth. In developing or transition countries foreign capital is considered one of the most important sources of economic growth, helping in creating new jobs and influencing technological innovation. Many governments design and implement strategies to attract Foreign Direct Investment over time. Therefore, determining the role of Foreign Direct Investment in different economies has become an important issue for designing policy responses. This paper aims to determine through empirical analysis, the determinants of Foreign Direct Investment flows in developing and developed countries and make policy recommendations for the promotion of Foreign Direct Investment in these countries. Based on the selected data period collected by the World Bank repository, we applied pooled regression models and panel data analyses to determine the factors influencing FDIs. Applying the fixed effect model and the random one, we identified the important factors impacting the FDI for developing and developed countries. Based on the results obtained by applying the random-effects model, among effective factors on Foreign Direct Investment inflows, we could mention Gross Domestic Product (GDP) growth, Official Development Assistance, Trade, inflation, regulatory quality, government effectiveness, political stability, and population. From all these factors, only inflation tends to decrease the Foreign Direct Investment inflows in a hosting country, and hence, governments in developing countries must give more attention to these factors.
The Global Pattern of Foreign Direct Investment in Recent Years
Abstracts Foreign direct investment (FDI) has a high impact on income and revenue generation to various countries in developing and developed countries. Some countries via their companies used FDI and Foreign Portfolio Investment (FPI) to advanced and control flow of investment to their mother countries. Similarly, global pattern of foreign direct investment has shifted from developed countries to developing countries with more inflow to countries of Brazil, Russia, India, China and South Africa (BRICS). Despite domination of FDI by triangle of trade (TRIAD) countries of America, European Union, Japan and United Kingdom as countries with higher inflow of foreign direct investments. Consequently, most of the countries among BRICS and TRIADS uses Tax haven for tax evasion and manipulations. Capital flight is another advantage used by United States of America to have more FDI due to power of its currency. Within last decade a significant shift FDI to developing countries has indicates change in global pattern in FDI. African countries suffer more from capital flight due to lax custom and border regulation and laws.
FOREIGN DIRECT INVESTMENT IN EMERGING AND DEVELOPED ECONOMIES
2012
In the context of globalization, the issue of foreign direct investments and their influence on the development of the emerging economies, continues to be a topic of interest for many economic theories. The need, the importance and the effects of foreign direct investments have attracted the attention of all the states and produced an intense competition to attract the foreign capital. FDI inflows have a very important role in the establishment of new world economic powers. In the world economy, the foreign direct investment are oriented in major proportion to developed countries, but the interest in this type of investment is particularly developed also in the emerging countries who need not only foreign capital inflows, but also the modern managerial experience and access to markets. The aim of this paper is to study and analyze the evolution of foreign direct investment in emerging and developed economies in the last twenty years.
Foreign Direct Investment as an Instrument for promoting Economic Development
Asian Business Review , 2013
A healthy financial sector is very much crucial for economic growth, specially for economies like Bangladesh. Because growth in Bangladesh must come largely from exports and its enterprises must, therefor, be internationally competitive. But unfortunately, Bangladesh has a financial system in which borrowers fails to repay loans, foreclosure is almost unheard of, and the government has to bail out banks. However, the Foreign Direct Investment (FDI) the most powerful weapon for accelerating economic development in Bangladesh. To attain an economic growth rate in the seven to eight percent range, investment has to be increased significantly, because of declining level of official development assistance in recent years and inadequate domestic savings, FDI presents opportunities for overcoming domestic resource constrains. The Board of Investment (BOI) was created as market mechanism where investors can cut through red-tap associated with foreign trade and business start-ups. FDI basically helps to fill-up the capital gap and shortage of a country. Foreign Direct Investment is one of the vital forces to boost up the economy. In this study paper we would like to draw a current scenario of Foreign Direct Investment in Bangladesh. In this regard we present the most updated data, avoid the uncompleted data and use the best judgment at the time of presenting the data to better knowing the current trend about the Foreign Direct Investment in Bangladesh. The benefits of FDI in-terms of physical capital formation, transfer of technology, and know-how are sufficient to justify sustaining these flows. Capital controls are not the answer to a rising flow of FDI. Foreign Direct Investment (FDI) will help the country in further developing infrastructure, creating more employment, developing capacity, enhancing the skills of labour force of the host country through transferring technological knowledge and managerial capability. To ensure that resulting payments liabilities remain within the country's debt-serving capacity, it essential to develop an effective non-intrusive reporting and monitoring system the main ingredients of which are presented in the study.
Foreign direct investment in developing countries
2008
During almost 7 years of endeavour, lessons and discussions that changed my way of thinking on economic issues, he enabled me to go beyond the typical mainstream frameworks without fear of failure. He was more than a teacher to me. I hope I have been able enough to benefit from his great insight and knowledge, and especially his great personality. I would also like to thank Prof. Dr. Sergio Rossi for accepting to act as Second Advisor and for his very useful remarks on form and content of the thesis. My special thanks go to Dr. Piyasiri Wickramasekara, whom I have the pleasure to be linked in friendship, for encouraging and supporting me and for providing precious advice.
Foreign Direct Investment: A Focused Literature Review
Foreign Direct Investment, FDI, is often, it is argued, one of the ways developing economies have to develop faster and catch up with developed economies, from which most of the FDI activities come from. There are complications, however, and FDI can have various unforeseen and even unfavourable consequences for the economy. As such, it is vitally important for policy makers to understand those limitations and potential effects of FDI, especially in the context of sustainable economic development: FDI is a double-edged sword that must be handled with care. The following paper offers an introduction to the literature of the subject with some thoughts of the author regarding some of the potential consequences of FDI. Special emphasis is on four aspects: FDI and economic growth, FDI and other capital flows, FDI and the balance of payments and FDI and financial stability.
Foreign Direct Investment: Global Trend and Pattern
Foreign Direct Investment (FDI) has registered a tremendous growth for the last four decades. The stock of FDI reached about 3.2trillionin1996risingfrom3.2 trillion in 1996 rising from 3.2trillionin1996risingfrom2 trillion in 1993 and $1 trillion in 1987. Sales and assets of TNCs are growing faster than world GDP, exports and gross fixed capital formation. The increased flows of FDI indicates the growing internationalisation and integration of economic activities around the globe. At the same time, with the gradual change in the motives for FDI as well as the shift of some location specific advantages from developed to developing countries, the patterns and trends of FDI has been experiencing a significant change in recent past. The motives of the TNCs have been shifting from more conventional resource or market seeking to efficiency or strategic asset seeking. Comparative cost factor has become the principal driving force for international production. Remarkable changes are also visible in the forms and sectorial pattern of international investments. The purpose of this paper is to trace the trajectory of the recent flows of FDI from global and regional perspective and to explore the reasons behind the prevailing trend and patterns.