Foreign direct investment (FDI) involves purchasing stakes in foreign firms or starting new ventures in different countries, exemplified by InBev's acquisition of Anheuser-Busch. Currency exchange markets are essential in facilitating FDI, showcasing the interconnectedness of financial activities globally.
Foreign direct investment (FDI) is a financial activity that helps a company based in another country. It involves purchasing a significant stake in a foreign firm or initiating a new business venture in a different country.
For example, InBev's acquisition of Anheuser-Busch in 2008 for $52 billion exemplifies FDI as the Belgian company entered the U.S. market by investing a substantial amount, demonstrating the impact of such cross-border investments on global economies.
Currency exchange markets play a crucial role in facilitating FDI as companies need to exchange their native currency with the foreign country's currency, highlighting the interconnectedness of financial activities across international boundaries.
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