ABSTRACT
With globalisation and increased flows of private capital across borders, major development institutions argue that foreign direct investment (FDI) can be a significant tool for poverty reduction. This chapter discusses in-depth Norwegian investment decision-makers with FDI in developing countries to uncover the motivations behind the investments. A look at FDI patterns reveals that investments are heavily concentrated in developed and high-growth regions. Aggregate data show enormous changes in the amounts and the pattern of capital flows from industrial countries to emerging economies in the 1980s and 1990s. Theory on FDI has seen foreign engagements of companies in terms of motivation to gain strategic positioning and access to resources. Norwegian investments represent a small portion of global FDI flows. The importance of strategic location for internationalising firms, and in turn the tendency for agglomeration, is firmly embedded in the theory of FDI, but seems conveniently forgotten when broader development strategies are shaped.
