scholarly journals Protection of National Sovereignty and Hindering Foreign Investment

Author(s):  
Badreddine Berrahlia ◽  

The article explores the recent debate regarding the rules of sovereignty and the need to acquire technology through Foreign Direct Investment (FDI) in relation to the Algerian Business Law. The article explores the 51/49 rule as an obligatory condition for direct international partnerhip projects, which requires a majority of Algerian ownership of at least 51 percent in all foreign direct investment projects (FDIP). The current research also investigates the impact of the 51/49 rule on the inflows of the foreign direct investments in Algeria as well as some other countries. The research concludes that there is no evidence that the amendment of the 51/49 rule would lead to technology transfer through the FDI.

2018 ◽  
pp. 1-14
Author(s):  
Badreddine Berrahlia ◽  

The article explores the recent debate regarding the rules of sovereignty and the need to acquire technology through Foreign Direct Investment (FDI) in relation to the Algerian Business Law. The article explores the 51/49 rule as an obligatory condition for direct international partnerhip projects, which requires a majority of Algerian ownership of at least 51 percent in all foreign direct investment projects (FDIP). The current research also investigates the impact of the 51/49 rule on the inflows of the foreign direct investments in Algeria as well as some other countries. The research concludes that there is no evidence that the amendment of the 51/49 rule would lead to technology transfer through the FDI.


2020 ◽  
Vol 10 (4) ◽  
pp. 367-379
Author(s):  
Saidu D Muhammad ◽  
Kenneth O Diyoke ◽  
Nnanna P Azu

Most of the Nigerian government’s transformation agenda is geared toward creating and enabling business environments to attract foreign direct investment. Opinions are divided as to the impact of foreign investment on trade and this researcher believed it could be either positive or negative. Hence, this research is to ascertain the magnitude of foreign investment’s impact on Nigeria’s bilateral trade. Integrating foreign direct investment in the gravity model, we applied the PPML technique because of its robustness and ability to recognise zero trade. We segregated foreign investment into three-flow, stock and its annual growth. Our estimation revealed that foreign direct investment stock impacts negatively on bilateral trade flow in Nigeria for both exports and imports and it is robust with the overall sample. Exporters’ foreign direct investment inflow was also revealed to have an impact on bilateral trade in Nigeria. But in all ramifications the magnitude of the negative impact is relatively small but statistically significant reflecting that trade and inward foreign investment are at least substitutes. Nigeria should further encourage inward foreign investment to further stimulate economic growth and aid in creating import substitution.


2019 ◽  
Vol 9 ◽  
pp. 77-89
Author(s):  
Khom Raj Kharel ◽  
Suman Kharel

 The purpose of this paper is to analyze the foreign direct investment status and environment in Nepal. There is significant contribution of foreign investment in economic development of developing countries like Nepal. Foreign investment attraction in a country like Nepal increases the foreign capital and technology transfer. Since 1990s inflow of foreign direct investment (FDI) has been increasing in Nepal due to the adoption of liberal economic policy by the government of Nepal. The Foreign Investment Technology Transfer Act (FITTA) has made better foreign investment environment in Nepal. This paper examines and analyses the contribution of FDI in Nepal. For the analysis, simple linear regression model has been applied to measure the impact of FDI on GDP and employment. Because FDI inflow has been recorded after 1990s, the impact of FDI has been analyzed in this paper over the period of 1990/91-2018/19. This study finds a positive impact of FDI on GDP and other macro variables.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Van Ha ◽  
Mark J. Holmes ◽  
Gazi Hassan

PurposeThis study focuses on the linkages between foreign direct investment and the research and development (R&D) and innovation activity of domestic enterprises in Vietnam.Design/methodology/approachThe Heckman selection model approach is applied to a panel dataset of nearly 7,000 Vietnamese firms for the 2011–2015 study period to investigate the impact of foreign presence on the R&D of local firms through horizontal and vertical linkages. Probit model estimation is employed to examine how foreign investment influences the innovation activity of local companies.FindingsWhile there are a small number of firms carrying out R&D activities in Vietnam, foreign or joint domestic–foreign venture firms are less inclined than domestic firms to undertake R&D. Domestic factors that include capital, labor quality, location and export status of firm have a significant effect on the decision of domestic firms to participate in R&D activity. Only forward linkages and the gross firm output are found to have an impact on the R&D intensity of domestic enterprises, while other factors appear to have no significant influence on how much firms spend on R&D activities.Practical implicationsIn order to promote the R&D activity of domestic firms, policy should focus on (1) the backward linkages between local firms in downstream sectors with their foreign suppliers in upstream sectors, and (2) the internal factors such as labor, capital or location that affect the decisions made by domestic firms.Originality/valueGiven that foreign investment may affect R&D and innovation activity of local firms in host countries, the impact is relatively unexplored for many emerging economies and not so in the case of Vietnam. The availability of a unique survey on Vietnamese firm technology and competitiveness provides the opportunity to address this gap in the literature.


2020 ◽  
Vol 3 (12) ◽  
pp. 17-23
Author(s):  
I. A. GUSAROVA ◽  
◽  
K. D. KOVALEVA ◽  
A. A. SAGDEEVA ◽  
◽  
...  

The article considers the role of foreign direct investment in various industry projects and their implementation. The statistics of the number of investment projects in Europe and Russia are analyzed. The best French experience of attracting foreign direct investment is considered. The main future trends of economic development that will affect the investment attractiveness of a country, taking into account the epidemiological situation in the world, are presented. The impact of the COVID-19 pandemic on changes in the implementation of investment projects in European countries was studied. The article describes the industries that have real economic potential for further development, as well as those that are most affected by the current global economic and epidemiological situation.


China Report ◽  
2018 ◽  
Vol 54 (2) ◽  
pp. 175-193 ◽  
Author(s):  
Jungmin Lee ◽  
Jai S. Mah

This article examines the impact of foreign-invested enterprises in the development of China’s automotive industry. It particularly focuses on the case of foreign direct investment (FDI) by a Korean firm, namely, the Hyundai Motor Company, in China. The Chinese government’s policy regarding the automotive industry allowed China’s domestic manufacturers to benefit from technology transfer, as foreign firms were not allowed to invest exclusively in China without a partnership. The contribution of Korea’s investment in China’s automotive industry would comprise the creation of job opportunities, technology transfer and the development of the automobile parts industry. Korea’s investment in the automotive industry of China has policy implications for China and other developing countries trying to expand their technology-intensive industries.


Author(s):  
Yilmaz Bayar

The globalization accelerated especially as of 1980s and the countries began to integrate global economy and remove the constraints on the flows of goods, services and capital. In this context, the developed countries partly shifted their environmentally hazardous production activities to the developing countries especially by means of foreign direct investments. This study investigates the impact of foreign direct investment inflows on the environmental pollution in Turkey during the period 1974-2010 by using Toda and Yamamoto (1995) causality test. We found that there was a bidirectional causality between foreign direct investment inflows and  emissions.Keywords: Foreign direct investment inflows,  emissions, causality analysis


2021 ◽  
Vol 69 (3-4) ◽  
pp. 80-94
Author(s):  
Aleksandar Kemiveš ◽  
Lidija Barjaktarović

This research paper examines the impact of external factors on the dynamics of foreign direct investment (FDI) trends in specific economies. The same subject will be analyzed through the examples of the Visegrad Group and the Republic of Serbia. The aim of the research is to determine the existence of a link between the impact of foreign direct investments on the growth and development of the economy observed through gross domestic product (GDP) in the 1990-2018 period. The results of the research indicate that Poland was the most successful in attracting and keeping FDI, compared to other countries. Further, the volume of FDI has been dependent on several external factors, such as overall business environment, economic crisis, political risks, positions in relevant institutions, pandemic, etc. Moreover, for the Republic of Serbia, it will be important that all stakeholders in the country have a proactive approach in order to keep FDI in the country. Finally, representatives of the authorities should be committed to fulfilling promised deals related to the regional cooperation and EU (European Union) accession and integration.


2018 ◽  
Vol 26 (4) ◽  
pp. 760-772
Author(s):  
Yury K Zaytsev

The economic and political sanctions had a significant impact on the behavior of foreign investors in the real sector of the Russian economy in the period 2014-2017. Despite a significant outflow of foreign direct investment (FDI) in 2015, in 2016-2017, there was an increase in investment activity associated with a steady inflow of FDI, which could be explained by the change in investment strategies of foreign business in Russia. The purpose of the study. The article assesses the impact of Western sanctions and Russian countersanctions on the influx of foreign direct investment into Russia. Methods. The work is based on methods of statistical analysis of the behavior of foreign investors in Russia on the basis of macroeconomic data of the Central Bank of Russia and microeconomic data of the “Ruslana” database. Results. The author gives various assessments of sanctions and counter-sanctions impact on the Russian and European economies, and compares the effects of sanctions policies in Russia and Iran. The stylized facts, identified by the author at the micro level, allow to interpret the macro statistics provided by the Central Bank of Russia at a qualitative level. The conclusion . In conclusion, the author gives recommendations on the possibilities of using new mechanisms of interaction with international institutions to overcome the investment crisis as a consequence of the sanctions regime.


Author(s):  
Ihor Shmorhun ◽  
Oksana Bulkot

The article is devoted to the study of the dynamics of the market of international investment resources. A comprehensive analysis of current trends in the market of international investment resources in terms of its structural division into the market of foreign direct investment, the market of basic investment instruments - stocks and bonds, and the market of financial derivatives. Based on the analyzed statistical information, the authors draw conclusions about current trends in the international market of investment resources. The analysis of the foreign direct investment market revealed a tendency to decrease the volume of direct investment capital in all regions of the world. It is shown that foreign direct investment market is suffering severely from the crisis caused by the COVID-19 pandemic, as well as from the impact of other factors such as the new industrial revolution, the transition of many world policies to greater economic nationalism, and the trend of sustainable development. In particular, countries with transition economies, developed and developing countries are suffered from decline of about 40% of foreign direct investments most of all. The market of basic investment instruments demonstrates a tendency to recover: the global stock market and the bond market also suffered significantly at the beginning of the pandemic in March 2020, but by the end of 2020 these markets had almost fully recovered and the bond market in general began to show record volumes and values. The derivatives and hybrid financial instruments market is showing a steady positive upward trend in 2020: trading in instruments such as currency futures, stock market futures, ETF options, etc. is showing significant growth. Such trends indicate that investors have become more active in portfolio investment strategies.


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