Foreign direct investment is a cross-border investment in which a resident or company of one country has significant control or influence over the management of an enterprise in another country. (These, on the other hand, are the most self sufficient economies in the world.)
To determine the countries where foreigners control the largest share of the economy, 24/7 Wall St. reviewed foreign direct investment net inflows and gross domestic product data from the World Bank. Countries were ranked by the percentage of foreign direct investment of total GDP. GDP and FDI figures are in current U.S. dollars for 2020. Macao’s data is for 2019. There were 195 countries with data. Other information came from sources that included insurance company Lloyds of London and the U.S. State Department.
Some of the nations on the list are tax havens, such as the Republic of the Seychelles, the Cayman Islands, and Luxembourg. These countries offer offshoring corporate structures, no or low tax policies, political stability, and little accountability.
Other nations are attracting foreign direct investment because they are rich in resources such as oil, timber, natural gas, and bauxite. These nations include Mauritania, Sierra Leone, and Mongolia. A $20 billion liquefied natural gas project in Mozambique is the single largest FDI in Africa, according to Foreign Affairs.
Infrastructure needs top the list of countries such as Somalia and Macao, and China is pouring its burgeoning wealth into infrastructure projects in Grenada, Congo, and Guyana. (Find out if any of the countries on this list are also among the poorest countries in the world.)
Nations that gained independence from colonial powers or from countries that held them as possessions have retained economic ties with their former occupiers, such as the African nation São Tomé and Principe with Portugal and the Pacific island nation of Palau and the United States.
As a point of reference, foreign direct investment as a percentage of gross domestic product in the U.S. is 1.01%, and the total amount for foreign direct investment is $211.29 billion, the second highest in the world. For China, foreign direct investment as a percentage of GDP is 1.44%, and the total foreign direct investment is $212.47 billion, the highest among 195 nations on the list.
Click here to see the countries dominated by foreign investment
