Investment, equity, money basket, tax evasion, subsidy, recession and finally economic stability what are these words indicates. A simple term which includes all these phenomena is foreign investment. Investing in foreign holds now becomes a main objective for the nations to have a controlled economic stability. The investment options may be any of kind simply following the nation’s criteria in investment portfolios. However it is the responsibility of global nations to handle the overseas investment with much attention towards the domestic portfolios and trade statistics. Elevating the foreign input through any kind of initiative should have a prime interest on domestic principles, rules and human traffic controls. Considering the manpower and inland economy is very much needed for good governance in the case of overseas investments.
Policies and positions of FDI in economy:
The best way to encourage investment with lower cost is improving the infrastructure. While comparing with foreign investment opportunities, the cost of infrastructure may look small as an ant but for the developing nations the cost will be a giant elephant. The time taken for such development will be longer with much needed manpower. The investment can be encouraged with prior tax benefits. Being tax as one of the important deciding factors of foreign investment, the favorable fall in its rates will speed up the investments. Even though the lessening of tax burdens encourages the overseas investments, the developing nation will have to compensate the losses to the domestic government. Another criterion to be considered during the investment is the subsidies made to an investor. The subsidies may be taken as an effective option, but still they play as a serious game changer in developing countries. This is because sometimes over subsidies will be taken as a cover to hold the poor efficiency of a nation. At present, with most of the nations within the investment hold, the FDI Regulatory Restrictiveness Index has been created with inclusion of 58 countries, including all G20 members and 22 sectors. This index gives foreign equity limitations, screening or approval mechanisms, restrictions on the employment of foreigners and operational restrictions as four basic restrictions of FDI.
Wider scope in global market:
Simply posting the investment interests of one nation in global economic board will not bring any preferred output. Especially when considering the real estate industry, the global attention is improving with advanced options. For say the real estate Malaysia, being a simple domestic real estate market should also need to satisfy the expectations of global market. Attracting the investors with enhanced resources and improved inland opportunities will habitually raise the market to a super power. The global summits and pronounced legislations have brought a new dawn to the investment opportunities in developing countries. Whether it may be a perfect financial reason or simply mutual benefit reason, the theme of the overseas investment remains unchanged. Any change in domestic economy will have a balancing effect from international market. That is why the overseas asset gathering is done to maintain a stable space in global turn with means of appreciation and better appraisal. Thus the factors in determining the investment grade relate all sort of components including both domestic and international.