Investing in development

OECD Observer
Page 57 

Foreign direct investment (FDI) in developing countries has risen sharply in recent years, becoming the most important source of external financing for some of them.

In China, the top non-OECD recipient in value terms, FDI was equal to 27.6% of GDP in 1998, compared with 3.1% in 1980, and employees of foreign firms numbered 18.4 million people, 2.6% of the total workforce. FDI plays an even more important role in other leading non-OECD recipients, with Indonesia showing an FDI to GDP ratio of 77.3% in 1998, up from 14.2% in 1980, while in Argentina the ratio doubled during the period from 6.9% to 13.9%.

But perhaps the most striking increase came in Vietnam, with FDI at 0.2% of GDP in 1980 and 54.5% in 1998 when it was ranked 19 th among non-OECD FDI recipients. By contrast, the world average FDI to GDP ratio is around 14%, with the EU at 17.3% and the US level at 9.5%.

• World Investment Report, UNCTAD, 2000.

©OECD Observer No 228, September 2001

Economic data


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