Europe

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fDi Editor | 05/01/2004 12:00 am

The European Union represents the most complete economic integration of any region in the world. There are no barriers preventing the free flow of goods, services, people and capital; trade policy is determined by the European Commission and 12 of the 15 states have adopted a common currency. As the EU has progressed through these different levels of integration to reach closer economic union, FDI levels have grown to represent 42% of global inflows in 2001. The ratio of FDI inflows to GDP was 50% higher in Europe than in the rest of the world in 2000. In 2002, the ratio of inward stock to GDP stood at 27.3%.

It appears, therefore, that Europe provides a comprehensive example of how increased regional integration can lead to a rise in levels of inward investment.

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