Study of FDI Trends and Patterns in BRICS Economies during the Period 1990–2015

Abstract

There has been a sea of change in foreign direct investment (FDI) patterns over the last two decades. One of the significant developments has been the developing economies and frontier nations garnering significant attention of foreign investors. Regions like developing Asia have been successfully commanding a huge share of FDI inflows. However, it has been observed that FDI patterns are quite skewed in nature in terms of sector and region-wise economic groups, such as Asia-Pacific Economic Cooperation (APEC); Transatlantic Trade and Investment Partnership (TTIP); Brazil, Russia, India, China and South Africa (BRICS); and Regional Comprehensive Economic Partnership (RCEP). Of these, BRICS nations are recognized as the most developed among the emerging economies. This research article is an attempt to examine the trends and patterns of FDI flows in BRICS economies during the period from 1990 to 2015. The study shows that developed markets are still considered to be drawing the lion’s share of FDI, claiming the top slots in global FDI inflows. But high-performing emerging and frontier markets can continue to attract FDI inflows if they have investors’ preferred market characteristics. Also there is a lot of unpredictability in the global FDI flows, indicating challenges and opportunities for both global business executives and countries seeking to promote investment. It is thus imperative that policymakers eliminate hurdles to FDI inflows and increase the absorptive ability to earn optimum positive results.