$ 400 million in foreign investment generates benefits
The Economic Commission for Latin America and the Caribbean of the United Nations (ECLAC) analyzed in 2013 the benefit it foreign direct investment (FDI) bring to the nations where it lands and concluded that it was still a topic of discussion.
According to the agency, while FDI inflows in the region, -which was $ 188.101 million in 2013-, stabilized at a high level over the past three years, its impact on the welfare of the inhabitants has not yet been proven.
The generation of employment was one of the examples the body took in its latest report about the impact of FDI. During the 90s, transnationals settled rather as a secondary source of new jobs, and for the period between 2003 and 2013, only 5% of jobs were generated by the FDI.
According to Jorge Calderon, Dean of the Faculty of Economics at the Universidad Espiritu Santo, one of the risks of foreign investment is that it focuses on a few activities and it negatively affects its multiplier effect.
As for the president Rafael Correa, the intention is to seek the transfer of technology more than mortgaging the countrywith foreign investment. “Who said that more foreign investment is the one that brings benefits to the country, that’s a myth,” he said.
Juan Carlos Lara, director of investments Pro Ecuador, recalled that the idea of the country is to have ‘greenfield’ investements, which prioritized sectors linked to the change of the productive matrix, such as the chocolate agro-processing.
For economic analyst Juan Pablo Jaramillo, FDI is good as long as it contributes to increasing the technological capital, the infrastructure, the production of a country and thus to create jobs. On the other hand, it would be detrimental if FDI constitutes a mechanism of domination to extract wealth in an economy whose political institutions are manipulated.
By generation of added value an investment of $ 400 million is estimated, and it is expected to close the year with 10% more FDI. In 2014, Lara saidthat nearly 400 jobs were generated with this strategy that seeks to promote a good investment climate.