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FDIs Help Spur Economic Growth Internationally

Now serving as chairman of Harvest International in Indonesia, executive Harvey Goldstein has been an influential presence in Southeast Asia for several decades. Also serving as director of the Singapore based, Business-Link Consultancy, Harvey Goldstein is well-versed in the subject of direct foreign investments (FDIs) in Asia.

An FDI occurs when a company or other entity invests in a company based in another country. The best FDIs tend to be those made in companies with good growth prospects and well-trained employees.

The investment itself can be made in several ways, including through establishment of a subsidiary in a foreign country by obtaining the company’s shares and transactions that take the form of joint ventures. In order to transact business, the investor must hold a minimum of 10 percent of the company’s ordinary stock.

A good example of an FDI might entail one business setting up a joint venture in order to develop and extract minerals in another country. Or, a company from one country might assume a majority stake in another business overseas. An FDI allows a host economy the opportunity to present its products in the international marketplace.