Foreign Direct Investment ( Fdi ) Essay

1660 Words Jul 22nd, 2016 null Page
Foreign Direct Investment The selection of Foreign Direct Investment (FDI) for a key term is tied into the importance and influence that FDI holds as it relates to the effects that it projects on foreign economies, culture and the political scenes. When financially well endowed organizations, enterprises, or even governments, invest in foreign markets, by either crafting supplier/buyer relationships with foreign enterprises, acquisitioning foreign enterprises, or basically establishing new production facilities to enter new foreign markets, there are underlying, and sometimes unintended consequences that the targeted nation (foreign market) will experience. Even dating back to the colonial times, before the birth of the US, mercantilism provided a grounding foundation for the British thirteen colonies and the territories of the French and Spanish to flourish into somewhat semi-dependent markets. Foreign direct investment, or "the opting of purchasing land or other resources in other nations (Saterlee, 2014)", has become a rising phenomenon in the intensifying of the globalization of foreign economies. FDI can take on two forms: Greenfield Investment and acquiring or merging with an existing operation in a foreign nation. The Greenfield Investment is when the organization decides to develop an entirely new operation in the targeted foreign nation. An example will be Nike setting up its manufacturing facilities, its distribution centers, and its retail shops within the…

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