IMPACT OF FOREGIN DIRECT INVESTMENT IN HOST COUNTRY: CASE OF TELECOMMUNICATION IN AFGHANISTAN

Abstract

Globalization and economic interaction involved in every part of the daily life and in modern businesses due to growth and international trade and country specialization. Therefore, the purpose of this study is to explore and identify the significant importance of FDI (Foreign Direct Investment) across the country, later examine the spillover of FDI on the host country, the country where a multinational corporation starts its branch of operations, and finally examine its contribution in economic and development of the host country. The study shows that foreign investment across the countries and regions played and crucial role in economic and development well-being and globalizations. The effect of foreign companies on domestic ones is one of the critical components of the study, the foreign companies’ productivity automatically spills over on local firms and in their industries. They must increase their productivity in order to survive in the market. Part of the study focused on telecommunications, where nowadays has been steady growth across the countries in the world. Telecommunication influenced the growth of unemployment as a whole and just like other businesses telecommunication considered an important dynamic component of a strong economic growth. Telecommunication has helped more in economic growth and development as it promotes sectors such as education, infrastructure, cumulative human skills, capacity building, and improve the public transportations.