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Understanding Foreign Direct Investment: Key Concepts and Regulations

 
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Delve into the world of FDI, regulations, and global impacts.

description: an abstract illustration showcasing global connections and investment flows, symbolizing the interconnected nature of foreign direct investment across different countries and industries.

Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in a company operating in a country other than that of the investor. This type of investment plays a crucial role in the global economy, facilitating business expansion, job creation, and technology transfer across borders.

Tweet. Relative to GDP, EU foreign direct investment stocks abroad fell in 2022; this was the fifth time in the 6 most recent years for such a decrease. This trend highlights the changing dynamics of global investment flows and the need for countries to adapt to shifting market conditions.

The European Commission is proposing that all Member States be required to adopt an FDI screening system and that those systems be made more uniform. This move aims to enhance transparency, security, and accountability in cross-border investments within the EU.

In this video series, the fDi team lifts the lid on some of the most common jargon and concepts. This first episode explains the definition of FDI, providing insights into the intricacies of foreign investment and its impact on economies worldwide.

Introduction On 24 January 2024, the European Commission (“Commission”) unveiled its proposals to reform the current EU Foreign Direct Investment framework. These reforms are designed to strengthen the EU's ability to protect strategic assets, promote fair competition, and safeguard national security.

In December 2023, Sweden adopted and implemented a new FDI regime, meaning that a general FDI screening mechanism now applies in relation to investments in key sectors. This regulatory development reflects the growing importance of monitoring and regulating foreign investments to mitigate risks and maximize benefits.

A multinational corporation (MNC) is a company that has business operations in at least one country other than its home country and generates revenue beyond national borders. MNCs play a significant role in driving economic growth, innovation, and globalization.

Foreign Direct Investment Regimes covering issues in China of Foreign Investment Policy, Law and Scope of Application, Jurisdiction and Regulatory Framework. China has emerged as a key destination for foreign direct investment, offering a vast market, skilled workforce, and strategic opportunities for global businesses.

In this video series, the fDi team lifts the lid on some of the most common jargon and concepts. This second episode explains the definition of 'greenfield' investments, which involve establishing new operations or facilities in a foreign country from the ground up.

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