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Foreign Direct Investment by Emerging Economy Multinationals: Coping with the Global Crisis

McAllister, Geraldine; Sauvant, Karl P.

Even before the onset of the global crisis, the global market for foreign direct investment (FDI) had undergone significant changes. Foremost amongst these changes was the increasing importance of emerging market multinationals (MNEs). While outward foreign direct investment (OFDI) from these markets is, in itself, not new, the magnitude that this phenomenon achieved prior to the crisis and its resilience in the face of the global crisis suggest that this is not a temporary occurrence but rather a sign of a fundamental change that is taking place in the global OFDI market. However, emerging markets are not homogenous: in addition to the rise in OFDI from emerging markets, the formation of new regional groupings has led to the emergence of fresh investment patterns. This chapter examines changes taking place in global FDI flows and looks at the impact of the crisis in the context of profound structural changes; it also focuses on the response of emerging markets and the enormous risks and challenges that lie ahead. It is vital to note that this crisis is ongoing, and it is too early to predict the final contours it will leave in its wake on the FDI landscape.

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Published In
Emerging Economies and Firms in the Global Crisis
Pages
14 - 46
Publisher
Palgrave Macmillan
Publication Origin
New York
Academic Units
Law
Institute for Social and Economic Research and Policy
Columbia Center on Sustainable Investment
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