The Voice of Foreign Direct Investment : Foreign Investor Policy Preferences and Experiences in Developing Countries
This paper provides insights to inform government efforts to attract and retain foreign direct investment, by analyzing the results of a survey of more than 2,400 affiliates of multinational enterprises across 10 middle-income countries. The paper...
| Main Authors: | , |
|---|---|
| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/587821601988275007/The-Voice-of-Foreign-Direct-Investment-Foreign-Investor-Policy-Preferences-and-Experiences-in-Developing-Countries http://hdl.handle.net/10986/34596 |
| Summary: | This paper provides insights to inform
government efforts to attract and retain foreign direct
investment, by analyzing the results of a survey of more
than 2,400 affiliates of multinational enterprises across 10
middle-income countries. The paper explores corporate
perspectives and decision-making on countries’ legal and
regulatory environments, political risk, and investment
promotion activities. The survey finds that a
business-friendly policy environment is critical to
multinational enterprises’ investment decisions, confirming
the importance of removing regulatory barriers to foreign
direct investment (particularly approval processes),
lowering political risks, and having investment promotion
agencies. The survey results also show that investors are
heterogeneous, with affiliates’ sectors, trading behaviors,
sizes, ages, source countries, and foreign ownership levels
affecting their perceptions of and sensitivity to various
policy factors. Thus, policy makers should tailor their
policy efforts to the needs of priority investor segments.
Notably, the analysis consistently finds variation based on
the extent to which affiliates import their inputs,
suggesting that this relatively understudied topic deserves
increased research and policy attention. |
|---|