Impact of Foreign Investment in Zambia
Question
Zambia is currently hosting a number of foreign investments concerns. Give a critical assessment of these firms as far as their contribution towards the socio-economic development of the Zambian society goes.
Foreign investment is important in any given country’s quest for accelerated and protracted socio-economic development. It is generally regarded as an essential element in that; it can bolster a country’s efforts to uplift a good segment of its poor people from squalor. This essay seeks to give a critical assessment of foreign investments firms as far as their contribution towards the socio-economic development of the Zambian society is concerned. But before the assessment, the essay will endeavour to define what foreign investment and further explain the forms of foreign investments.
Foreign investment can be defined as the flows of capital or simply capital investment by firms of one nation into those of another in exchange for significant ownership stakes in domestic companies or other domestic assets. According to Potter (2008), foreign investment denotes that foreigners take a somewhat active role in management as a part of their investment. Foreign investment is in two forms; foreign portfolio investment and foreign direct investment. Foreign portfolio investment is a passive investment in the securities or financial assets like bonds, notes and stocks of another country. Foreign Direct Investment (FDI) on the other hand is direct investment by a company in production located in another country either by buying a company in the country or by expanding operations of an existing business in the country. Foreign direct investment involves production facilities, real estate, inventories and other non-financial assets.
The subject or impact of foreign investment in Zambia and many other least developed countries is very controversial. However, this essay will try and have a critical assessment of the subject. To start with modernisation
Zambia is currently hosting a number of foreign investments concerns. Give a critical assessment of these firms as far as their contribution towards the socio-economic development of the Zambian society goes.
Foreign investment is important in any given country’s quest for accelerated and protracted socio-economic development. It is generally regarded as an essential element in that; it can bolster a country’s efforts to uplift a good segment of its poor people from squalor. This essay seeks to give a critical assessment of foreign investments firms as far as their contribution towards the socio-economic development of the Zambian society is concerned. But before the assessment, the essay will endeavour to define what foreign investment and further explain the forms of foreign investments.
Foreign investment can be defined as the flows of capital or simply capital investment by firms of one nation into those of another in exchange for significant ownership stakes in domestic companies or other domestic assets. According to Potter (2008), foreign investment denotes that foreigners take a somewhat active role in management as a part of their investment. Foreign investment is in two forms; foreign portfolio investment and foreign direct investment. Foreign portfolio investment is a passive investment in the securities or financial assets like bonds, notes and stocks of another country. Foreign Direct Investment (FDI) on the other hand is direct investment by a company in production located in another country either by buying a company in the country or by expanding operations of an existing business in the country. Foreign direct investment involves production facilities, real estate, inventories and other non-financial assets.
The subject or impact of foreign investment in Zambia and many other least developed countries is very controversial. However, this essay will try and have a critical assessment of the subject. To start with modernisation
References: Akuffo, F.W.B. (2006). Theories of Social and Political Change, Module DS 3. Lusaka: Zambian Open University. Daniel Bekele, (2011 November 3). Labour Abuses in Zambia’s Chinese State-owned Copper Mines: “You’ll Be Fired If You Refuse. Human Rights Watch Report. Potter, R.B. (2008). Geography of Development: An introduction to development studies (3rd Ed.). London; Pearson Education Limited. Todaro, P.T., & Smith, C .S. (2010).Economic Development, 10th Edition, London; Pearson Education Limited. United Nations Conference on Trade and Development (2006).The Investment Policy Review of Zambia.