Flows of money to the developing world may be in the form of aid, but investment is important
When companies and TNCs invest in the developing world this flow is called Foreign Direct Investment (FDI)
FDI is motivated by profit
FDI is used to set up factories fund construction in the developing world
Most FDI flows towards NICs and RICs because they have a skilled workforce, and large markets
There are question marks over the environmental and social value of FDI is relation to pollution and worker rights
The top 10 developing world locations for FDI in 2007 (in $ millions).
Notice the lack of least developed countries in the list
China & Hong Kong
Governments use Export Processing Zones (EPZs)and Free Trade Zones (FTZs) to help attract FDI. China has over 50 of these. In these zones foreign investors receive special tax breaks, rents are low and unions are often banned.