GLOBAL FINANCIAL AND ECONOMIC CRISIS AND FOREIGN DIRECT INVESTMENT IN EASTERN COUNTRIES
The economic and financial crisis, which became truly global in the autumn of 2008, has already had and will undoubtedly continue to have a negative impact on the international movement of foreign direct investment (FDI). However, the impact of the crisis on different countries, groups of industries, and types of investment is mixed. In 2009, against the background of negative economic dynamics in most countries, positive growth rates continued in China, India, and other major Eastern countries. A number of factors can contribute to the growth of FDI inflows to Eastern countries and increase the role of Eastern countries as capital exporters. These include maintaining positive growth rates and a quick recovery from the crisis in Eastern countries, the ability to move production facilities to them in order to reduce costs, reduce the cost of assets, and increase the role of investors from Eastern countries - Asian TNCs and national welfare funds. Keywords: financial and economic crisis, foreign direct investment, Eastern countries. On September 15, 2008, the economic crisis became truly global. The investment bank Lehman Brothers was declared bankrupt. Within two weeks of that date, the crisis spread like wildfire around the world. Already at the beginning of October 2008, the stock price on the world's stock markets fell sharply. The beginning and harbinger of the global financial crisis was the crisis in the US mortgage market in the summer of 2007. Along with the debt on mortgage loans of insolvent borrowers - individuals, there was also excessive debt of companies and investment funds. In the last two decades, the world has seen a large number of mergers and acquisitions of companies, both at the national and transnational levels. Mergers and acquisitions, rather than investments in new projects, account for a significant portion of global foreign direct investment (FDI) flows. Moreover, their inflow to the world as a whole increased precisely in those years when ... Read more
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20.07.2024 (187 days ago)
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