Economy & debt

DTE Factsheet, May 2006

What is FDI?

Foreign Direct Investment (FDI) is an important feature of an increasingly globalised economic system. It occurs when a company based in one country makes a long-term investment in a company located in another country. The 'home country' company may gain partial or total control of the 'host country' company. The direct investor does this by purchasing an existing overseas enterprise, providing capital to start a new one or buying 10% or more of it.