How do you Feel About Foreign Direct Investment for a Country's Growth?

[Jasz]

Foreign direct investment is a contentious issue. Some argue it's good for a country's growth because of the inflow of capital, while others contend that it can lead to instability and exploitation.

To really understand its effects, we need to look at the history of its use. In the 1990s, foreign direct investment was used by developing countries in Asia to attract capital from large corporations. The goal was to develop infrastructure and human capital in order to create jobs.

In the 2000s, foreign direct investment grew more controversial when it was used as a tool by foreign governments to gain access to resources like water and oil. Critics argued that this practice led to exploitation of local people and governments, which could lead to unrest in the long term.

However, recent studies have shown that foreign direct investment can be beneficial if it's regulated properly and if local people are able to benefit from its effects.

Probably it has its advantages, but personally i don't support it for the following reasons:
I feel it could be bad for the economy. First, it takes business away from local companies and puts them into the hands of outside corporations. Second, it hurts local employees because an outside company is not likely to pay local wages. Third, it can cause conflicts between countries as foreign companies enter into a country's industries and take over. In short, foreign direct investment is kinda bad for a country's growth.

 

[eldavis]

Well said, personally I think the major issue here is the fact it completely takes the attention off local companies. Here in my country, I have noticed that once they here the word "foreign" they tend to feel it's the best. We tend to downgrade products and companies that has local origins feeling they are fake or inferior.

 

[Jasz]

@eldavis you have a point. Here in my country, i wouldnt just know if it's the situation of the country or the problem of the citizens. The Chinese investors are kinda having all the benefits to themselves. Citizens rights are not protected. No indigenization. Well, citizens don't even have choice than to work under unfavourable conditions with little pay since the country is not fending for her citizens or providing alternative for them.
We even have some Country men, foremen or would i say supervisors that still join hands with foreigners to suffocate their country men. Chinese company used to be life safer, a sure employment opportunity but now they don't pay reasonable wages like they used to and our government are doing nothing about it. I guess they know about itI

 

[btaliat]

There is no good that a country will derive from foreign investments. Though many will argue against this based on this, as a political scientist, I can authoritatively say that the disadvantages of having foreign investments are more than the advantages of it.

China never know that it will be the second economy power of the world when he depended solely on the British for her survival some decades again. China could not afford things of their own and only waited for the foreigners to come for investments.

In the early 2000s, then we have the Asian tigers and now the rest is history. China made sure that her local products are only used in the country and no preference was given to foreign goods. Up till now, there is nothing China has not localized. It has the largest high speed route in the world.

In contrast, Nigeria was a country of her glory in the 1970s and depended so much on her locally products. In fsct, Obasanjo then made usage of locally goods compulsory and in 1980s, a dollar is #0.74. But when SAP was introduced, foreign goods were put much importance to and now a dollar is a little less than #1000.