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Foreign direct investment

Foreign direct investment

Q Compare and contrast Foreign Direct Investment (FDI) and other forms of International Business.

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Joint ventures are different from FDI as two or more parties have to agree for investing equity, effort and time for the international business. Such restrictions are not there in FDI (Iamsiraroj, 2016). Foreign Direct Investment (FDI) is direct investment and others are passive investment. On the other hand, there are differences between exporting and FDI as well. Exporting can be considered as a perfect practice of shipping goods from domestic country to foreign country whereas FDI suggests an investment into production within a country whereas the company is located in a different country. Licensing can be considered as rapid entry strategy unlike FDI. FDI is stable and others are volatile.