Foreign Direct Investment (FDI) is an investment made by an individual or a company in one country into a business located in another. Aside from offering financial benefits, FDI is known to bring with it enormous knowledge, technology, skills, and employment. No wonder most countries around the world seem to be advocating for Foreign Direct Investments.
Unfortunately, not everyone has what it takes to reap any of the available foreign direct investment advantage. For some, this type of investment is just not worth it. If this sounds like you, then it might the right time to consider changing how you do things.
Fret not, though, since we are here to help you understand what is destined to come your way. The following are the key advantages accompanying Foreign Direct Investment.
Helps Foster Economic Development
This is arguably one of the greatest foreign direct investment advantages you should know about. You’d be surprised to learn that FDI remains to be the primary source of external capital together with increased revenue for a country.
In most cases, FDI results in the setting up of more factories in the country of investment, in which some local equipment is utilized. This can be materials or even labor force. The process is repeated based on the skill levels of the employees.
Development of Human Resources
There’s no denying that Foreign Direct Investment aids with the development of human resources. This is mostly the case when there is transfer of training, technology and best practices. When this happens, the human capitals are offered adequate training and skills, which have the potential to help boost their knowledge on a wide scale.
But when you factor in the overall impact of the economy, human resource development is vital for increasing a country’s human capital quotient. With more and more resources acquiring skills, rest in knowing they can train others and lead to a ripple effect on the economy.
No wonder it remains to be one of the best foreign direct investment advantages you should expect after taking this route.