Brazil And Mexico, Foreign Direct Investment, A Comparative Study

Looking at the economic development of Latin American countries history, it is easy to see the importance of foreign direct investment. Because they are the most attractive in foreign capital as Latin American countries, Brazil and Mexico will inevitably become the focus of the study. As the South America's largest country, Brazil has long been important to the foreign investment in the Latin American region. Mexico is more developed countries in the third world economies, particularly in recent years has developed rapidly. In 2003 per capita GDP reached 6,230 US dollars, its comprehensive national strength and level of economic development, ranked first in Latin America, has been recognized as the future of the development of newly industrialized countries. Although the use of foreign capital in the process of great ups and downs, and its economic growth and the amount of foreign capital is inseparable .It can be said, the relationship between the two countries and foreign capital are not cooperation but conflict.This article begin to study some aspects of attracting foreign capital in different historical periods in Brazil and Mexico, in the development of their own industries, foreign policy and the similarities and differences on the use of foreign influence on the economic development of the two countries, and through bilateral FDI absorption evaluation model forecast future developments in the two countries.From a historical point of view, Brazil and Mexico are the beneficiaries and also victims in the use of foreign capital. After World War II, the two countries implemented import substitution strategy, both in introducing a massive amount of foreign capital and the use of direct foreign investment in the development of the country's emerging industries, Brazil has experienced "economic miracle" of six years, Mexico's economy developed rapidly and the two countries have become newly industrialized countries. Despite the remarkable success, but inappropriate foreign policy to the effect of the two countries is scared. Excessive reliance on foreign capital has not brought benefits to the two countries, and the contrary, it has produced a crisis. Therefore, the change in foreign policy has become the most important task to the two countries. According to international political and economic structure and the evolution of the country's development needs, they repeated adjustments of the national economic development strategy, revised foreign policy, adjusted the relations of foreign capital, strengthened the control, guided foreign investment and made full use of foreign capital in national economic development and controlled their negative shadow to the minimum.Brazil and Mexico, the course of development of the two countries has given many people careful consideration and useful enlightenment. Countries want to develop, we must open to the outside world and to attract foreign investment. But opening up, it is not a simple open-door, introduction of foreign investment we can not allow the foreign capital arbitrary increasingly. The country should give full play to the functions and the implementation of "macro-and micro-control plan in a free market adjustment", and guide foreign businessmen to invest in key projects, on the mainland and not well-developed rural areas. In addition to economic reform, political reform, structural reform, social reform must keep up with. On foreign policy it is necessary to dare to open up, and also the courage to management: Government agencies should be streamlined, but the government's macro-control must not be weakened. So, we can make ourselves invincible.The utilization of foreign capital brought the two countries to the experiences and lessons more warning to posterity. We also have reason to believe, in the future of development Brazil and Mexico will make use of more and more effective methods of direct foreign investment for the country's economic services, thus boosting the economic development of Latin American countries, then become the main world investment areas.