Multinational enterprises (MNEs) interact in the global market, creating lots of jobs all around the world. Foreign Direct Investments (FDI) is the way by which they interact, investing abroad until representing the largest source of external finance for developing countries for instance (United Nations Conference on Trade And Development). No need thus to explain the importance of those FDI in the business world, which is growing more and more. Developing countries' inward stock of FDI currently corresponds to nearly one third of their GDP, whereas it was only 10% in 1980. According to the UNCTAD statistics, 53 million jobs are directly provided by the Transnational Corporations (TNCs) all around the world. Still, this amount does not take into account all the indirect jobs created, as well as the technological and managerial changes these companies bring to their host countries.
[...] Because foreign MNEs in Canada tend to have a global vision and often have a larger view than the domestic markets in which they operate, their inward FDI works to then build export growth by transforming domestic operations into their worldwide operations. Considering this, majority owned foreign affiliates are dominant players in Canada's trade, accounting for nearly the half of Canadian manufactured exports. Canada is finally not only dependant vis-à-vis the United States, but concerning MNEs in general; they account for an essential part of Canadian's economy. [...]
[...] This amount of foreign investment permits to Canada to rank 5th of the FDI flows' recipient in 2005. Considering the figure 2., it is not a surprise to notice that these biggest FDI recipient, which are part of the more active countries concerning FDI, are thus also the biggest Canada's contributors, like the United States, the United Kingdom, France, the Netherlands or Germany. The United States, mainly for geographic reasons, and probably because of the cultural similarity between the two neighbour countries as well, is contributing to 64% of Canadian's inward FDI stock. [...]
[...] Source Country Projects USA 536 France 79 UK 70 Germany 57 Japan 47 With 536 projects invested in Canada since 2002, the US (Exxon Mobil, Convergys, Ford, etc.) have once again the impressive statistic of investing more than twice projects than France, the UK, Germany and Japan all together! But in addition to this Superpower, Canada is also highly dependant of its four main sectors, which concentrate all together 56% of its projects. Information and Communication Technology, Heavy Industry, Business and Financial Services and Transport Equipment are these four industries. [...]
[...] Trade, Foreign Direct Investment, and R&D Spillovers, Journal of International Business Studies 30 Third Quarter, 491-511. Rao, S., & Tang, J. (February 2000). Are Canadian-controlled Manufacturing Firms Less Productive than their Foreign -Controlled Counterparts?, Industry Canada, Working Paper # Rheaume, G. (June 2004). Open for Business ? Canada's Foreign Direct Investment Challenge. The conference board of Canada. Van Pottelsberghe De La Potterie, B. & Lichtenberg F. (2001). Does Foreign Direct Investment Transfer Technology Across Borders?, The Review of Economics and Statistics 83 490-497. Stewart, [...]
[...] (2003). Plant Turnover and Productivity Growth in Canadian Manufacturing, Micro-Economic Analysis Division. Ottawa : Statistics Canada Barrell, Ray & Nigel Pain (1999). Domestic Institutions, Agglomerations and Foreign Direct Investment in Europe, European Economic Review 43, 925-934. Brainard, S. Lael (1997). An Empirical Assessment of the Proximity- Concentration Trade-Off Between Multinational Sales and Trade, American Economic Review 520-44. Davidson, W. H. (1980). The Location of Foreign Direct Investment Activity: Country Characteristics and Experience Effects, Journal of International Business Studies 11, 9-22. [...]
APA Style reference
For your bibliographyOnline reading
with our online readerContent validated
by our reading committee
