I need a different perspective on a response post in ENGLISH to this initial discussion post TYPED BELOW) for International Business class, thanks. (Initial Discussion post) Foreign direct investment FDI plays a crucial part of the global economy, as it promotes economic growth, creates employment opportunities, and facilitates the transfer of technology and knowledge. FDI is usually considered by companies that are looking to offer employment to open economies that have skilled workers and above-average growth prospects¹.

The crucial management issues in the FDI decision is the assessment of political, market potential, competition and legal risks. Geopolitical risks can be dealt with across several time frames by organizations. Companies can make investments to take advantage of opportunities and become more resilient by creating short term and midterm crisis-response teams. The team would identify potential risks and develop strategies for mitigating them in the short team. Another investment would be PR and government relations teams that stay in touch with senior government officials and key stakeholders in multiple jurisdictions. Which allows the team to develop relationships with officials to share the companys thoughts on key issues and gather insights about potential regulatory actions or sanctions that could affect it.²

At the lowest level of economic integration, a free trade area, countries significantly reduce tariffs and some are abolished completely. Each member country keeps its tariffs regarding third countries, including its economic policy. The general goal of free trade agreements is to develop economies of scale and comparative advantages, promoting economic efficiency. Some restrictions that may be faced are limitations on ownership or restrictions on the movement of capital and labor. Despite these limitations, a free trade area provides organizations with increased market access and expansion opportunities.³

Moving to the right of the complexity is economic integration. Sets common external tariffs among member countries, implying that the same tariffs are applied to third countries; a common trade regime is achieved. Custom unions are particularly useful to level the competitive playing field and address the problem of re-exports where importers can be using preferential tariffs in one country to enter (re-export) another country with which it has preferential tariffs. Movements of capital and labor remain restricted.³ Although, FDI may still deal with obstacles in the form of differing regulations and standards among member countries. Organizations must maneuver these differences and ensure cooperation with respective regulations to successfully engage in FDI.

A common market is a formal agreement where a group is formed amongst several countries that adopt a common external tariff. In a common market, countries also allow free trade and free movement of labor and capital among the members of the group. The trade arrangement is aimed at providing improved economic benefits to all the members of the common market.⁴

Economic and political union is the highest level of economic integration, where member countries not only have a common market but also share a common currency, coordinate economic policies, and have a unified political structure⁵. This level of integration provides the most favorable conditions for FDI, as organizations can operate in a truly integrated and harmonized market.