Foreign direct investment, referred to as "FDI", multinational companies are the main forms of FDI. Foreign direct investment is one of the main forms of modern capital internationalization. According to the definition of the International Monetary Fund, it refers to the investment of enterprises operating in countries other than the investor's country with sustained income, and its purpose is to have a say in the operation and management of enterprises.

This investment method not only involves the flow of funds, but also involves the transnational transfer of a series of resources such as technology, management and sales channels. FDI not only brings capital, technology and management experience to the host country, but also brings advantages to investors such as market, reducing production costs and being close to the consumer market. As the main carrier of foreign direct investment, multinational corporations make production and sales layout on a global scale, make full use of the resource advantages of various places and realize the optimal allocation of resources.

Capital of foreign direct investment

Regarding the nature of international direct investment, some scholars emphasize "operating resources", especially the intangible assets of enterprises. Some scholars emphasize "control".

Relevant international institutions, government departments and theoretical circles believe that the fundamental difference between international direct investment and international indirect investment lies in whether or not to obtain the control right of the invested enterprise, because intangible assets formed by foreign direct investment are in the core position, while monetary capital is in a very secondary position, so indirect investment can only be made. Therefore, foreign direct investment not only directly participates in management, but also directly aims at obtaining the control right of the invested enterprise.

Based on this, some scholars believe that "foreign direct investment refers to a long-term investment behavior in which enterprises in a country or region gain control over some or all foreign enterprises through the international transfer of monopoly advantages (mainly intangible assets) in order to achieve a high degree of unity between the ultimate goal and the direct goal."

The above contents refer to Baidu Encyclopedia-Foreign Direct Investment.