Question

In 2008, inward FDI accounted for some 63.7 percent of gross fixed capital formation in Ireland but only 4.1 percent in Japan ( gross fixed capital formation refers to investments in fixed assets such as factories, warehouses, and retail stores). What do you think explains this difference in FDI inflows into the two countries

Answer 1

This difference in FDI inflows into Ireland and Japan is accounted by the prospects of economic growth.

Step-by-step explanation:

Ireland is a growing economy. Japan's economy has been shrinking for some years now. Ireland has improved its competitiveness. It is providing better open, transparent, conducive, and dependable investment environment for both foreign and domestic firms to thrive. It has eased the doing of business in the economy, provided access to imports and exports trade, and boasts of a relatively flexible labor market. These are backed by enhanced protection of intellectual property rights.