Fdi in North America

Analysis of Foreign Direct Investments of North America
Kristin Daughdril & William Cassidy
Business Administration 418

Abstract
Foreign Direct Investment (FDI) is an investment involving a long-term relationship and reflecting a lasting interest in and control by a resident entity in one economy of an enterprise resident in a different economy (UNCTAD). There are two types of FDI, inflows and outflows, which can be used to help determine the investment strategies and economies of countries engaged in FDI. North America has been the source of nearly one-half of all investment and almost three-quarters of the jobs created throughout the globe (Huggins, 442). North America is probably the most important continent when it comes to dealing with FDI. The three main countries of North America, the United States, Canada, and Mexico, all rank in the top 15 of world economies, proving them to be desirable partners in FDI transactions. The trends of FDI discussed in this report will be unparalleled to this information and can lead to some predictions on how future trends of the countries of North America will continue to be superior to that of the other continents of the world.
Keywords: Foreign Direct Investment, FDI Inflow, FDI Outflow

Foreign Direct Investment is investment of a company located in a different country either by buying a company in the country or expanding its business into the country. FDI can be done for many purposes. Companies may have tax incentives abroad, cheaper labor, abundant resources, target-specific markets or other reasons to enter into direct investment with a foreign country. Three components of FDI include equity capital, reinvestment earnings, and intra-company loans. These three components are the values that, if changed, will affect FDI first-hand. FDI inflows are flows of investment into the reporting country from a non-resident entity. Outflows are just the opposite. They are the reporting countries’ investments into a



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