ABSTRACT
In active foreign direct investment (FDI) promotion, Western European approaches to attracting foreign investment have been characterised by increasing activity and sophistication in both policy design and delivery. This chapter considers the policy context for the whole of Western, provides a background for understanding the scale and effects of policy competition. The chapter focuses on the strategic context of policy by examining the importance of foreign investment as a goal for Western European governments, both from the perspective of the differing national as well as European Community approaches to the regulation of foreign ownership in the economy. The United States remains the country receiving the largest inward investment flow - US$ 85 billion in 1996. As a region though, Western Europe is currently the main destination for worldwide FDI. Several distinct geographical features characterise current FDI flows in Western Europe.
