Resource information
The fall in foreign direct investment
(FDI) since 1999 and China's growing share, worry most
developing countries. But an in-depth look reveals new and
promising trends. The decline is largely a one-time
adjustment following the privatization boom of the 1990s.
FDI is coming from more countries - and going to more
sectors. The conditions for attracting FDI vary by sector:
in labor-intensive manufacturing, for example, efficient
customs, and flexible labor markets are key, while in
retail, access to land and equal enforcement of tax rules
matter most. Sorting out the microeconomic issues by sector
will be good, not only for FDI, but also for domestic investors.
