FDI, or foreign direct investment, is a type of investment where a company transfers its production and/or research overseas, thereby directly investing in the host country. Although this is a global practice among multinational businesses, it is met with strong opposition from many groups for several reasons.Perhaps the strongest opposition comes from the fear that the entrance of multinational companies will threaten local companies. The multinational companies with the capacity to transfer production overseas are organizations with enormous capital and managementknow-how. Such companies will be no match for many local firms, especially in emerginge conomies.The second reason stems from the idea that multinational companies only invest in the host country to exploit its cheap labor and natural resources. There is a growing presence of factories constructed by multinational conglomerates in emerging economies such as Vietnam and India; however, the workers employed by these companies receive wages that are far below those received in other countries. For example, an hourly wage received by afactory employee with a 12-hour shift is a miniscule US$1.50.
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