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Maximizing Benefits from Foreign Direct Investment and Minimizing its Costs: What Can We Learn from China?

In: Foreign Investment in Developing Countries

Author

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  • Kevin Honglin Zhang

Abstract

Foreign direct investment (FDI) by multinational corporations (MNCs) has been viewed as a major catalyst to economic growth in developing countries. Yet the benefits of FDI do not automatically accrue and evenly across countries. It is possible for some countries even to be worse off with inward FDI flows. National policies and the host government’s bargaining power against MNCs matters for attracting FDI and for reaping the full benefits. This study attempts to shed light on the question of how a developing country can maximize the benefits from FDI and minimize its cost, based on China’s experiences in the 1980s and 1990s.

Suggested Citation

  • Kevin Honglin Zhang, 2004. "Maximizing Benefits from Foreign Direct Investment and Minimizing its Costs: What Can We Learn from China?," Palgrave Macmillan Books, in: Harbhajan S. Kehal (ed.), Foreign Investment in Developing Countries, chapter 4, pages 78-91, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-55441-2_5
    DOI: 10.1057/9780230554412_5
    as

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