Filip De Beule

Changing policy regimes in outward foreign direct investment: From control to promotion

Following in the footsteps of the developed countries, more and more firms from emerging markets have gradually accumulated sufficient technological and other capabilities—also known as firm-specific advantages—to allow them to expand their operations to other countries and can consequently be labeled multinational enterprises (MNEs) (van Agtmael 2007). As a result, flows of outward foreign direct investment (OFDI) from emerging markets have increased significantly over the past thirty years (chapter 1; Gammeltoft 2008).

Chinese outward direct investment in Europe and Belgium: Characteristics and policy issues

The foreign ventures of Chinese enterprises such as Haier, Lenovo, CNOOC (China National Offshore Oil Corporation), and SAIC (Shanghai Automotive Industry Corporation) during the beginning of the twenty-first century drew so much media attention that even the general public has become aware of the expansion of multinational firms from emerging economies, especially from China. In Belgium more recently the significance of Chinese investors was underlined by the role played by the insurance firm Ping An as a minority shareholder in the saga about the nationalization and subsequent sale of the Fortis Bank to the French financial group BNP Paribas and the rejected bid by the Chinese auto producer Beijing Automotive Industry Corporation (BAIC) to take over General Motors’ European Opel operations, including the plant in Antwerp, Belgium.

Impact of Outward Foreign Direct Investment Promotion Policy: Evidence from Newly Industrialized, Emerging, and Developing Asian Economies

Abstract nPurpose nTo analyze the industrial development of South, East, and Southeast Asian nations in terms of investment and trade and how the institutional environment – in particular, the government policy with regard to outward foreign direct investment (OFDI) – has played a role in this respect. n n nMethodology/approach nThe chapter puts OFDI policy and industrial upgrading in newly industrialized, emerging, and developing Asian economies (NIEDAEs) in historical perspective to attempt to draw inference from their past behavior. n n nFindings nThe chapter provides information about each NIEDAE’s experience with OFDI policy through a comparative analysis of OFDI promotional policy. n n nPractical implications nA useful source of information about each NIEDAE’s OFDI policy approach, the chapter attempts to draw recommendations for OFDI policy. n n nOriginality/value nThis chapter fulfills an information need and offers practical help to government policy makers.

Inward FDI in Belgium and its policy context

As a small open economy, Belgium has been actively and successfully attracting inward foreign direct investment since the 1960s and consequently has one of the most internationalized economies in the world. Foreign affiliates represent approximately 35% and 21% of manufacturing and services jobs as well as 42% and 24% of value added by the manufacturing and services sector, respectively. Despite an overall drop in competitiveness of Belgian industry, the introduction of a new and innovative incentive, the notional interest deduction scheme, to lower corporate income tax for all firms in 2005 has led to an increase of inflows of equity capital from 2006 onward, although the financial crisis took its toll on inflows in 2008 and 2009. In addition, the risk capital allowance has done much to promote Belgium’s role as a financial conduit, allowing a large proportion of the authorized capital to flow back to other countries in the form of loans. This trend was reinforced by the global financial crisis.