Reasons for promoting outgoing FDI

Outward foreign direct investment (FDI) can bring important benefits to the parent company and the host country. Promoting outward FDI can help companies: 1. Gain access to foreign markets and resources: FDI is an effective way for companies to enter new markets, acquire valuable technology and resources, or join forces with foreign companies to form strategic alliances. By entering a new market, companies can diversify their business and reduce the risk associated with doing business in a single market. 2. Increase economies of scale: When companies invest in a foreign company, they can use their economies of scale to reduce production costs. This cost savings can be passed on to consumers, resulting in increased sales and profits. 3. Increase learning opportunities: Companies can learn from other countries and cultures. They can gain insights and understanding through joint ventures and collaborations with foreign companies. 4. Create jobs and economic development: Companies’ investments in FDI can create economic and employment opportunities in the host country. This can result in the growth and development of the local economy. 5. Enhance branding and reputation: Investing in FDI can help a company improve its public image and build a positive brand. This can help the company access new markets, attract foreign talents, and gain a competitive edge.