New Horizons in Regional Science series
Edited by Philip Cooke, Mario Davide Parrilli and José Luis Curbelo
Chapter 9: Outward FDI from Developing Countries MNEs as a Channel for Technological Catch-up
9. Outward FDI from developing country MNEs as a channel for technological catch-up* Alessia Amighini, Roberta Rabellotti and Marco Sanfilippo 1. INTRODUCTION An increasingly important aspect of globalization is the growing number of developing country multinational enterprises (MNEs).1 This is demonstrated by the annual Fortune ‘Global 500’ ranking of the top 500 MNEs across the world: in 2009, 86 companies in the list were from developing countries, compared to 69 in 2007 and only 19 in 1990. These companies are small relative to the world’s largest MNEs, they are owned by developing country nationals (in some cases with government a major capital shareholder), and operate on a global basis through subsidiaries, outsourcing and integration in global value chains (GVCs) and global production networks (GPNs) (UNIDO, 2006). According to the United Nations Conference on Trade and Development (UNCTAD, 2009), outflows of foreign direct investment (OFDI) from developing and transition economies reached 19 per cent of world total in 2008. Asia has the highest level foreign direct investment (FDI) outflows, but this trend is spreading to all regions. In terms of stocks, developing countries account for more than 15 per cent of the world total, with the following regional composition: Asia 65.7 per cent of total stock, followed by Latin America with 21.7 per cent, the transition economies with 8.7 per cent and Africa with 4 per cent. Within each region, a few countries play the leading role: China, India and the Association of South East Asian Nations (ASEAN) countries in...
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