Foreign direct investment (FDI) is a concept that consists of the transfer of capital from one country to another through individuals, companies, and governments to create a lasting interest and for economic or business purposes.
An FDI is a cross-border investment in the form of controlling ownership in an enterprise in one country by an entity based in another country.
Foreign direct investments play a very important role in global business. They can provide a company with new markets and marketing channels, cheaper production facilities, access to new technologies, new products, new skills and a variety of financing schemes. The enterprise that receives FDI benefits from all this plus improved organizational and management capabilities and, better yet, increased capitalization leading to economic development.
For years, foreign direct investment has been an important factor in economic development and international cooperation between economies. It has also been key to creating and maintaining long-term economic relationships, and so fostering international relations between countries
Purpose of foreign direct investment
Simply put, FDI t is a type of international investment that represents the objective of obtaining a long-term interest in an enterprise located in another country by an investor from one country. FDI implies a long-term relationship between the investor and the enterprise, as well as substantial influence by the investor on the management of the enterprise. When a direct investor holds 10% or more of the voting power on the board of directors (in the case of an incorporated enterprise) or its equivalent, the existence of such an interest is technically recognized (in the case of an unincorporated enterprise).
Foreign direct investment usually involves more than cash. It may also involve the provision of management, technology and equipment. FDI can be thought of as a different economic approach used by companies wishing to open a new factory or office or to buy existing assets from a foreign company. These companies produce (and often sell) goods and services in countries other than those in which they were founded, in order to supplement or replace international trade.
Companies seeking FDI often look for companies in open economies that can offer a competent workforce and above-average development potential.
Foreign direct investment in Spain
In Spain, FDI has played an important role in its economic recovery and development. Spanish FDI has recovered in recent years due to an increase in competitiveness and investor confidence due to the restructuring of the financial sector, the boom in tourism, a highly efficient transport network, the development of renewable energies and Spain’s cultural proximity to Latin America, a potentially profitable market. Spain also aspires to become one of the world’s leading research centers and has begun to create the necessary infrastructure.
Spain is currently one of the most attractive and competitive business markets in the European Union. The country is also the EU’s third-largest investment market. After the economic crisis and the current global pandemic, the Spanish government provided lucrative and financially rewarding incentives for the private sector, making it the second-largest recipient of FDI, including the least restrictive regulations for international investments. The Spanish government has also provided investors with attractive incentives and tax breaks to promote innovation and create jobs and offers grants and subsidies to qualified investors.
Foreign Direct Investment in Portugal
Investing in the Golden Visa Portugal private equity or venture capital funds is a good option for acquiring residency in Portugal. The funds are managed by fund managers accredited by Portugal’s regulatory body, the CMVM. Your specialist fund manager ensures that Golden Visa Portugal fund investments are properly managed in start-up companies or medium-sized projects with optimal growth potential.
Residency by investment
Investment visas are designed to attract foreign capital and business people by granting them the right of residence in exchange for a monetary investment.
Investment programs generally have multiple criteria that must be met for the investment to qualify. These investments are related to job creation, real estate purchases, non-refundable contributions or investments in specific industries.
Our investment visa programs provide applicants with the right to live, work and conduct business in their chosen country in exchange for an investment in a property, business, or government fund.
Orience Investment Advisory Service
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