Businesses nowadays are tapping into the international market by setting up branches worldwide. Foreign investment is a move considered by all companies irrespective of the industry for example universities are moving to other countries as well as banks. Many countries in the past were very protective of local industries by discouraging foreign investment as much as possible. Governments this days have considered and agreed to allow foreign companies to expand into their countries. What have softened governments is discovering that their country gains to gain from foreign investors through.
Citizens of the country will have wide variety of employment vacancies. Companies when they expand will require personnel with local expertise. Thus the country resident will get employed and earn their wages and salaries from the business.
Innovation on the infrastructure. Foreign companies are known to partner with the country’s authorities to improve on the transportation and communication channels. Also the government will expand its sources of income by having the non-resident company pay fees and taxes.
Provision of high quality goods and services. This is especially the case with education where foreign institutions helps to diversify the education sector of the country. Therefore residents are able to acquire skills which there had to travel abroad to learn locally.
Legislation which have been passed to facilitate expansion of businesses into the country includes.
The law relating to ownership of land. Some countries had very strict conditions that a business had to own a piece of land in order to operate in the Country. The problem was that the land owners in the country were afraid of their land being acquired by foreigners. Foreign country’s land is exposed to high dangers and the company stands to lose large part of it investment in case its operations are shut down. Foreign governments have done away with this restriction and have agreed to let the company rent out either land or building to set up its business.
Foreign governments are doing away with the many bureaucratic rules and regulations to non-resident companies. Non-resident companies in the past had to submits very many documents before they could get the registration certificate. This would take a lot of time and many business would give up midway. Foreign governments have eliminates some procedures so that it takes a short period of time to get approval.
Financial payments to the government is the only item that foreign countries are still reluctant to adjust fairly. Fees and taxes imposed on foreign companies has been raised at a very high rate by the local governments. Non-residents are being advised that the high payment are compensation to the local government efforts of making it easy for them to expand.
Foreign government will at one point in time have to give in to the concerns raised by the high fees and taxes imposed on foreign companies.
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