FOREIGN DIRECT INVESTMENTS AS A MODEL FOR CREATING SUSTAINABLE ECONOMIC GROWTH

Abstract

In the contemporary open global economic environment, the growth and functioning of a national economy depends, in large, on the relations which it establishes with the rest of the world. The content and intensity of those relations, besides trade, are increasingly marked by the investment processes which provide the internationalization and matching in the dynamics of the global market. An increasing degree of integration and interdependence, together with fierce competition, impose on the economic entities the need to find new ways to enable access to the markets of input (raw materials, propagating materials and parts) and output (products and services). Companies distribute their production activities or other business functions by means of direct investments abroad, trying to provide the best conditions for the supply of raw materials, energy and manpower, that is, the most profitable placement of its products. Foreign direct investments are primarily related to multinational companies which, by means of investments abroad in the form of direct investments, show permanent interest for presence on the markets of other countries.