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is a multinational from a developed country that asks its supplier in a developing or newly industrialized country to co-locate either in its home country or in other countries (Guillén 2005).

Firm-Specific Assets

Scholars also devoted attention to the proprietary, firm-specific intangible assets of the new MNEs, noting that they engaged in foreign direct investment with the purpose of not only acquiring such assets but also exploiting existing ones. Foreign expansion with a view to acquiring intangible assets, especially technology and brands, was not very important during the 1970s and 80s, but has become widespread in the last two decades (UNCTAD 2006). With the advent of current account and currency exchange liberalization in many developing and newly industrialized countries, the new MNEs have enjoyed more of a free hand in terms of making acquisitions, including multi-billion dollar deals. Many of these have targeted troubled companies or divisions located in the United States and Europe that possess some brands and product technology that the new MNE is in a better position to exploit because of its superior or more efficient manufacturing abilities. Acquisitions have not been the only way to gain access to intangible assets. The evidence suggests that the acceleration in the international expansion of the new MNEs has been backed by a number of international alliances aimed at gaining access to critical resources and skills that allow these firms to catch up MNEs from developed countries. As argued above, these alliances and acquisitions have been critical for these firms to match the competitiveness of MNEs from developed countries. For this reason the international expansion of new MNEs runs in parallel with the process of upgrading their capabilities. Sometimes however, capability upgrading precedes international expansion. This is the case, for instance, of some state-owned enterprises that undergo a restructuring process before their

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