{
  "title": "FDI Flows to Low-Income Countries: Global Drivers and Growth Implications",
  "publication": "IMF Working Papers, June 1, 2010",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/fdi-flows-to-low-income-countries-global-drivers-and-growth-implications-23889",
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  "summary": "What accounts for variations in FDI flows from advanced to developing countries? How have FDI inflows explained cross-country growth experiences? In this paper we tackle both these questions empirically for a large sample of middle and low-income countries.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Research questions:\n  - What accounts for variations in FDI flows from advanced to developing countries?\n  - How have FDI inflows explained cross-country growth experiences?\n- Two key results (verbatim):\n  - (i) lower borrowing costs and positive real-side external factors were increasingly important drivers of FDI outflows to low-income countries in the pre-crisis period;\n  - (ii) economic fundamentals, the strength of economic reforms, and commitment to macroeconomic discipline are crucial determinants of the growth dividends of FDI.\n- Policy conclusion:\n  - The paper suggests that low-income countries can turn to domestic policy solutions to mitigate the adverse effects of a potential decline in FDI in the post-crisis world."
    },
    {
      "heading": "Main findings and empirical focus",
      "content": "- Empirical scope:\n  - A large sample of middle and low-income countries.\n- Drivers of FDI outflows to low-income countries (pre-crisis emphasis):\n  - Lower borrowing costs.\n  - Positive real-side external factors.\n- Determinants of FDI’s growth dividends:\n  - Economic fundamentals.\n  - Strength of economic reforms.\n  - Commitment to macroeconomic discipline."
    },
    {
      "heading": "Policy implications and recommendations",
      "content": "- Emphasize domestic policy solutions in low-income countries to offset potential post-crisis declines in FDI.\n- Focus areas for policy to enhance FDI’s growth impact:\n  - Strengthening economic fundamentals.\n  - Advancing economic reforms.\n  - Sustaining macroeconomic discipline."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subject: Emerging and frontier financial markets, Financial sector development, Foreign direct investment, Plurilateral trade, Real interest rates\n- Keywords: FDI flow, FDI inflow, FDI outflow, low-income country, source country, WP\n\nInternational Monetary Fund. \"FDI Flows to Low-Income Countries: Global Drivers and Growth Implications\", IMF Working Papers 2010, 132 (2010), accessed 9/17/2026, https://doi.org/10.5089/9781455201150.001\n\n---\n\n Content in this bundle\n\n- wp10132\n  - wp10132 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp10132 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/fdi-flows-to-low-income-countries-global-drivers-and-growth-implications-23889"
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    "Published: June 1, 2010",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781455201150.001",
    "Research questions:",
    "Two key results (verbatim):",
    "Policy conclusion:",
    "Empirical scope:",
    "Drivers of FDI outflows to low-income countries (pre-crisis emphasis):",
    "Determinants of FDI’s growth dividends:",
    "Emphasize domestic policy solutions in low-income countries to offset potential post-crisis declines in FDI.",
    "Focus areas for policy to enhance FDI’s growth impact:",
    "Subject: Emerging and frontier financial markets, Financial sector development, Foreign direct investment, Plurilateral trade, Real interest rates",
    "Keywords: FDI flow, FDI inflow, FDI outflow, low-income country, source country, WP",
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