FDI and Development: Emerging Issues

Dear Colleagues,

In the current context of an increasingly global and liberal world economy, attracting FDI is becoming a central policy issue for all developing countries, whatever their size or income level. For the last two decades, numerous developing countries have implemented costly infrastructure policies and institutional reforms in order to integrate their domestic firms into the trade in tasks and global value chains. Trade and FDI are therefore becoming growingly complementary and intertwined. However, not all countries have succeeded in reaping economy-wide benefits from FDI in assembly activities, the latter often concentrating its impact on a few local firms without bringing widespread spillovers for the rest of the economy. Moreover, the impact on economic development of new forms of cross-border investment, such as South-to-South FDI, FDI carried out by smaller companies or FDI based on land or intangible assets such as brands or technology, remains largely unknown. Lastly, by modifying the sectoral structure of production and labor demand, FDI certainly has indirect distributive effects that have not been sufficiently analyzed so far, although they will inevitably breed sociopolitical conflict and need to be addressed by national social policies in the future. A finer-grained analysis of the direct and indirect benefits and costs of the various types of FDI flows and investment incentives would certainly provide useful information to both academics and policy-makers. Innovative research papers on the determinants and impacts of FDI by type or by sector, the articulation between trade and FDI, the impact of South–South FDI on both source and host countries and the political economy of FDI and foreign investment policy would be welcomed.

Prof. Dr. Eric Rougier
Guest Editor

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