Trade
Foreign Direct Investment (FDI)
Definition
Investment from a company or individual in one country into business operations or assets in another country, involving lasting management interest (typically 10%+ ownership).
Explanation
FDI differs from portfolio investment (buying stocks/bonds) because it represents a lasting commitment to operating in the host country. FDI brings capital, technology, and management practices. The United States, China, and Singapore are among the largest FDI recipients. FDI inflows as a percentage of GDP are tracked by the World Bank.