FDI netinflows are the value of inward direct investment made by non-residentinvestors in the reporting economy. FDI net outflows are the value of outwarddirect investment made by the residents of the reporting economy to externaleconomies.
Inward Direct Investment, also called direct investment in thereporting economy, includes all liabilities and assets transferred betweenresident direct investment enterprises and their direct investors. It alsocovers transfers of assets and liabilities between resident and nonresidentfellow enterprises, if the ultimate controlling parent is nonresident.
Outward direct investment, also called direct investment abroad, includesassets and liabilities transferred between resident direct investors and theirdirect investment enterprises. It also covers transfers of assets andliabilities between resident and nonresident fellow enterprises, if theultimate controlling parent is resident.Outward direct investment is also called direct investment abroad.
Foreigndirect investment is a category of cross-border investment associated with aresident in one economy having control or a significant degree of influence onthe management of an enterprise that is resident in another economy. As well asthe equity that gives rise to control or influence, direct investment alsoincludes investment associated with that relationship, including investment inindirectly influenced or controlled enterprises, investment in fellowenterprises (enterprises controlled by the same direct investor), debt (exceptselected debt), and reverse investment. Implementation of the Balance ofPayments Manual 6th Edition (BPM6) methodology has brought changes to thedefinition of direct investment by making it consistent with the OECDBenchmark Definition of Foreign Direct Investment, notably the recasting interms of control and influence, treatment of chains of investment and fellowenterprises, and presentation on a gross asset and liability basis as well asaccording to the directional principle.
Data on FDIflows are presented on net bases (capital transactions' credits less debitsbetween direct investors and their foreign affiliates). Net decreases in assetsor net increases in liabilities are recorded as credits, while net increases inassets or net decreases in liabilities are recorded as debits. Hence, FDI flowswith a negative sign indicate that at least one of the components of FDI isnegative and not offset by positive amounts of the remaining components. Theseare instances of reverse investment or disinvestment.
Data on FDI net inflows andoutflows are based on the sixth edition of the Balance of Payments Manual(2009) reported by the International Monetary Fund (IMF). Foreign direct investmentdata are supplemented by the World Bank staff estimates using data from theUnited Nations Conference on Trade and Development (UNCTAD) and officialnational sources