Abstract
This article is a discussion of the role and importance that foreign direct investment (FDI) has played in the Polish economy in light of the process of economic transformation accomplished inPolandsince 1989. Much of the background information has been extrapolated from our prior research into the topic conducted over the past thirty years. The article discusses the positive aspects of FDI, outlines its main “players” in the Polish economy, offers suggestions relating to necessary preconditions for successful FDI activities, and describes the introduction of FDI within the larger context of economic reforms in Poland that dealt with the negative derivative traits of the former command-and-control economy.
Highlights
Foreign Direct Investment, more commonly known as foreign direct investment (FDI), occurs with the purchase of “the physical assets or a significant amount of the ownership of a company in another country to gain a measure of management control.” (Hunter, 2012/2013, Chapter 7; Hunter & Ryan, 2012, p. 594.) Ordinarily, FDI inflows are counted from a 10 percent stock ownership in a company abroad
This article is a discussion of the role and importance that foreign direct investment (FDI) has played in the Polish economy in light of the process of economic transformation accomplished in Poland since 1989
The article discusses the positive aspects of FDI, outlines its main “players” in the Polish economy, offers suggestions relating to necessary preconditions for successful FDI activities, and describes the introduction of FDI within the larger context of economic reforms in Poland that dealt with the negative derivative traits of the former command-and-control economy
Summary
Foreign Direct Investment, more commonly known as FDI, occurs with the purchase of “the physical assets or a significant amount of the ownership (stock) of a company in another country to gain a measure of management control.” (Hunter, 2012/2013, Chapter 7; Hunter & Ryan, 2012, p. 594.) Ordinarily, FDI inflows are counted from a 10 percent stock ownership in a company abroad. Foreign Direct Investment, more commonly known as FDI, occurs with the purchase of “the physical assets or a significant amount of the ownership (stock) of a company in another country to gain a measure of management control.” 594.) Ordinarily, FDI inflows are counted from a 10 percent stock ownership in a company abroad. FDI may be distinguished from a more traditional type of investment termed portfolio investment ( called passive investment) because in a passive investment the investor is not seeking a degree of control in a company but only a return on investment. Examples of portfolio investment may be the purchase of corporate debt securities, mutual funds, stocks, bonds, interest-bearing bank accounts, treasury bills, and promissory notes. As an active form of investment, FDI may take the form of a merger-and-acquisition activity with an existing company or entity (often referred to as a “Brownfield” activity where the purchaser acquires an ongoing business operation), or may take the form of creating an entirely new investment—literally from the “ground up” (often referred to as a “Greenfield” activity)
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