Foreign Direct Investment - Government Policy Instruments and FDI - Host Countries: Restrictions
3 important questions on Foreign Direct Investment - Government Policy Instruments and FDI - Host Countries: Restrictions
What restricitions can a government impose to block incoming FDI?
- Ownership restrictions
- Performance demands
- Performance demands
Why would a government impose ownership restrictions?
To prohibit nondomestic companies from investing in certain industries. Such prohibitions typically apply to business in cultural industries and companies vital to national security.
What is entailed in performance demands as a restriction?
These demands include ensuring that a portion of the product's content originates locally, stipulating that a portion of the output must be exported, or requiring that certain technologies be transferred to local businesses.
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