Foreign Direct Investment & Exchange Report Research Paper

Foreign Direct Investment & Exchange make known - Research Paper ExampleThe paper tells that control in the host country is usually acquired by increasing active company operations. It can also be done by purchasing a company in the host country. In this case, foreign investors may want to extend business and digest Redbox to Brazil since Brazil does not invest in Redbox. Alternatively, Brazil can invest in manufacturing and merchandising of Redbox. Considering various factors, FDI offers stable stinting gain especially for countries that are focused on growth. The reason FDI for Redbox in Brazil is necessary is because FDI has been proved to be sustainable and stable even when other metropolis flows such(prenominal) as equity portfolio are faced with major hitches. This trend has evidently existed for many years and has contributed to the pause of capital inflow from portfolio investment and bank loans to FDI. On the contrary, Brazil can invest in Redbox if at that place is as surance that it will exceptionally contribute to growth and development. Brazil can also take usefulness of its financial stability to invest since FDI takes vantage of the financial crisis. Brazil will also have the improvement of control over its resources. The flow of capital to other nations other than the investors country also has the advantage of giving high rates of return. This is because the flow of capital internationally reduces risks that are faced by capital owners hence enabling investors to diversify investment. Moreover, the integration of global capital markets helps in the spreading of best economic practices in areas such as governance among other areas.