Impact on home and host developing economies

Home as well as host economies can benefit from FDI from developing countries, but it may also carry some downside risks. The net outcome depends on various factors such as the level of development of a country, its economic structure and its policies, on the one hand, and the motivations of the TNCs, the industry of the investment and the mode of entry, on the other. The private gains of TNCs and the benefits to home and host countries may converge or diverge, depending on the precise context and on how effectively home- and host-country policy interventions are designed and implemented. This chapter examines the impact on home and host economies, while issues related to home- and host-country policies are analysed in chapter VI.

Sustainable Development Goals:

Decent Work and Economic Growth