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FDI - Coggle Diagram
FDI
FDI to the UK
Birmingham: HS2 Railway is likely to be backed by Chinese money
Coventry: Jaguar and Land rovers Headquarters are here but owned by Indias Tata
Northumbria: Cheung Kong infrastructure owns Northumbrian Water, Southern Water and Northern Power Networks
Heathrow: China owns 10% of Heathrow airport and Qatar owns 10% of British airways
Northampton: Weetabix is headquartered here but own by Chinas state-owned Bright Food
How it arose
Political stability - Began in the 1960s - loosing asset
TNC(company’s that work across multiple nations) formed + became big
China post 1976 - Mao Zedong died - 1978 open door policy
Trade blocs formed WOT+IMF+WB
Different types of FDI
IBRD - was to provide loans to help rebuild economies
IMF - help governments balance their payments within this system
WTO- countries seek for liberalisation of manufactured goods
GATT- an act signed by 23 countries in 1947 to facilitate trade
How governments encourage FDI
Encourage business start-ups: Methods for this range from low business taxes to changes in law allowing both local and foreign-owned business
Free-market liberalisation: aka neo-liberalism upholds 2 beliefs. One being that government intervention impends economic development and that as overall wealth increases, trickle down will take place.
Privatisation: running services was proven costly so sold to private investors to reduce costs
What is FDI
A financial injection by a TNC or government department into another country