Blog Post

Does South-South FDI Pay?

IGC, International Growth Centre

Can South-South FDI, or investment flows between institutionally comparable partners better stimulate growth through backward linkages? When it comes to foreign direct investment, much of the concern both in the public and in the academic community centres on investment flows moving from developed to developing countries, but there is now an increasing trend of developing economies exchanging investment flows amongst themselves. One might expect such south-south exchanges to better adapt to local economies and therefore be more useful.