Green Field Investment

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What is a 'Green Field Investment'

A green field investment is a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. In addition to building new facilities, most parent companies also create new long-term jobs in the foreign country by hiring new employees.

This is opposite to a brown field investment.

BREAKING DOWN 'Green Field Investment'

Green field investments occur when multinational corporations enter into developing countries to build new factories and/or stores.

Developing countries often offer prospective companies tax-breaks, subsidies and other types of incentives to set up green field investments. Governments often see that losing corporate tax revenue is a small price to pay if jobs are created and knowledge and technology is gained to boost the country's human capital.

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    Read about the advantages and disadvantages of pursuing green field or brown field investments in the foreign direct investment, ... Read Answer >>
  3. What does it mean when a country has little activity in its capital account?

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