When it comes to converting foreign direct investment into income growth and technological upgrading, Shenzhen, China, has been far more successful than Penang, Malaysia. The reason is simple: Shenzhen, unlike Penang, supported the rise of innovative local businesses.
SEOUL – Few experts doubt that foreign direct investment can bolster economies by bringing in critical know-how, expanding local production, and creating jobs. It is no surprise, therefore, that attracting FDI has long been a top priority for developed and developing economies alike, as reflected in the generous incentives included in the United States’ Inflation Reduction Act. But, when it comes to driving economic growth and development, FDI has a mixed record.
SEOUL – Few experts doubt that foreign direct investment can bolster economies by bringing in critical know-how, expanding local production, and creating jobs. It is no surprise, therefore, that attracting FDI has long been a top priority for developed and developing economies alike, as reflected in the generous incentives included in the United States’ Inflation Reduction Act. But, when it comes to driving economic growth and development, FDI has a mixed record.