An investment policy is any government regulation or law that encourages or discourages foreign investment in the local economy, e.g.
currency exchange limits.
globalizationintegrates the economies of neighboring and of trading states, they are typically forced to trade off such rules as part of a common tax, tariff and traderegime, e.g. as defined by a free trade pact. Investment policy favoring local investors over global ones is typically discouraged in such pacts, and the idea of a separate investment policy rapidly becomes a fiction or fantasy, as real decisions reflect the real need for nations to compete for investment, even from their own local investors.
A strong and central criticism of the new global rules, made by many in the
anti-globalization movement, is that guarantees are often available to foreign investors that are not available to local small investors, and that capital flightis encouraged by such free trade pacts.
Investment policy in many nations is tied to immigration policy, either due to a desire to prevent
human capital flightby forcing investors to keep local assets in local investments, or by a desire to attract immigrants by offering passports in a safe havennation, e.g. Canada, in exchange for a substantial investment in a business that will create jobs there. A frequent criticism of such joint immigration-investment policy is that they encourage organized crimeby providing incentive for money-launderingand safe places for "bosses" to move to when the heat rises in their home country.
tax, tariff and trade
foreign direct investment
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