Attracting Foreign Direct Investment to Latin America (original) (raw)

Foreign direct investment in Latin America and the Caribbean

Foreign Direct Investment in Latin America and the Caribbean 2018, 2018

National and international policies have a significant influence on the changes that occur in the business environment in Latin America and the Caribbean, providing incentives for investment decisions, not only for companies already operating in the region, but for new entrants as well. Currently, foreign direct investment flows are the outcome of a combination of factors, including the international environment, national policies, and corporate strategies. Thus, this research evaluates the volume of FDI inflows into the region; the factors that attract them, including incentives and regulations; and their contribution, economical and societal, to Latin American development. This research also explores some of the potential costs of FDI, and its implications on policy options.

Domestic and International Determinants of Foreign Direct Investment in Latin America

2000

This paper examines the domestic and international determinants of FDI in 14 Latin American countries from 1978 to 2007. Specifically, what factors led to the upsurge in FDI into the region? Whether countries with well-developed financial markets attract more FDI inflows? The empirical findings in this paper show that both domestic and international factors have been important determinants of FDI

Foreign Direct Investment in Latin America: Current Trends and Future Prospects

2000

1.A rising tide of Foreign Direct Investment (FDI) has swept the developing countries over the last ten years. Between 1990 and 1998, the net annual inflow of FDI in developing countries rose from 30.5 billion to 163 billion in constant (1998) U.S. dollars. 2. The increased FDI has not been equally absorbed in the developing world. In fact, the Latin America and Caribbean (LAC), East Asia and Pacific (EAP), and Europe and Central Asia regions (ECA) have captured most of the increased investment.

FDI attractiveness in Latin America

2014

This paper focuses on the identification of the variables determining the attractiveness of foreign direct investment in Latin America, represented by 17 countries over a period of time from 1996 to 2011. It considers variables traditionally not taken into account, such as the tax rate and institutional factors, which have revealed important explanatory variables also traditionally considered as GDP, inflation, population, the share of GDP by sector, the income level, etc. According to the analysis in this paper and the results obtained, it is very clear that institutional factors such as the size of the economy and the population have an influence in attracting FDI flows. The institutional quality is determinative for the attraction of foreign direct investment to these countries. Property rights, monetary freedom and investment freedom, are institutional indicators of great relevance as explanatory factors for attracting foreign direct investment, while government expenditures follows to a lesser degree.

Determinants of FDI in Latin America

2006

En este documento estudiamos cuáles son los determinantes de los flujos de capital extranjero en los países de América Latina. Nosotros consideramos los factores incluidos en otros estudios, entre estos, el tamaño del mercado, el nivel de desarrollo de la infraestructura, y los salarios. Con la finalidad de obtener una mejor medida del tamaño del mercado ajustamos el PBI con un factor de pobreza. Además, consideramos indicadores de apertura de la economía, la estabilidad macroeconómica, el capital humano y la importancia de los recursos naturales. También tenemos en cuenta los efectos de las privatizaciones. Los resultados obtenidos proporcionan importantes indicaciones sobre cómo puede un país atraer más inversión directa extranjera.

Economic reform and foreign direct investment in Latin America

Progress in Development Studies, 2007

After almost 25 years of experimenting with the neo-liberal economic reforms collectively known as ‘Washington Consensus’ policies, Latin Americans are starting to re-assess the merits of these policies at the voting booth. Whereas one of the key policies of the ‘Washington Consensus’ package was the liberalization of investment regimes, many of the newly elected governments are beginning to scrutinize the role of foreign direct investment (FDI) in their countries. Indeed, some nations have gone as far as to nationalize foreign firms. Without endorsing or condoning the actions taken by these governments, in this paper we argue that it is quite rational and very justified for governments in the region to re-evaluate the role of FDI for their development paths. Our exhaustive review of the literature on FDI in Latin America during the reform period shows that very few nations in the region actually received significant amounts of FDI as a result of reform, and that when FDI did materi...

Foreign Investment in Latin America: Recent Trends and Prospects

Latin America in the International Economy, 1973

The author is indebted to the members of the CEPLAN seminar and to Mrs. Rosemary Thorp for their helpful comments. a This does not mean that we ignore important contributions published in the last decades. Several of the most recent publications are mentioned in the bibliography at the end of the text.

Foreign Direct Investment In Latin America During The Emergence Of China And India : Stylized Facts

Policy Research Working Papers, 2007

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Integration and Foreign Investment in Latin America

Handbook of Research on Economic Growth and Technological Change in Latin America, 2014

The processes of economic integration in Latin American economies have logic that goes beyond the simple interest of trade creation. The governments focus on the benefit produced by Foreign Direct Investment (FDI) as one of the most important reasons to formalize trade agreements. FDI differs in the way in which this investment relates with the local producer sector and the strategy trade policy followed by local governments. In this sense Latin American economies may receive horizontal or vertical FDI, and this chapter aims to examine the impact of strategic trade policies on the inflows of FDI into two Latin American regions: North Region and South Region. These investment flows come from three economic zones: Asia, America, and European Union. To this end, the gravity equation to compare the weight of variables such as distance, infrastructure, trade openness, and cultural affinity as independent variables and FDI as the dependent variable is estimated. The results obtained show that the strategy trade policy followed in the North Region in the form of trade liberalization, and the strategy trade policy followed in the South Region in the form of a relative closeness with the custom union plus the proposed trade agreements with other regions encouraged inflows of FDI in both regions during the analyzed period. While the gravity hypothesis holds on the South Region, in the North Region it does not hold. In the North Region, vertical FDI is received, and in the South Region it is horizontal FDI.