Foreign Direct Investment and Economic Growth: The Cases of Singapore and Oman
Economic growth is associated with improvements in productivity, and increasing productivity is driven by growth in economic efficiency, structural changes and substitutional activities. To raise these factors, innovation and trade are substantial drivers. However, there are many economies with a high potential for economic growth but a lack of domestic investment. Foreign direct investment (FDI) is able to fill the gap between investment needed to promote economic growth, and locally available investments. This article highlights the potential of FDI for small economies using Singapore and Oman as examples.