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sekkat and veganzones-varoudakis 2007 have classified the factors determinative the inward flow of fdi into 3 categories: basic economic factors trade and also the exchange market policies and alternative aspects of the investment climate. the essential economic factors embrace the distinction within the rate of come on capital across countries portfolio diversification strategy of investors and market size of the host country. trade and interchange policy issues relate to trade easing and charge per unit movements and also their volatility froot and stein 2001 business climate factors relate to infrastructure wheeler and mody 2002 labor prices and accessibility of arch labor/education incentive factors political risk economic factors per capital gross domestic product gross domestic product rate of growth economic integration importance of transport commerce and communication social factors degree of urbanization political stability the quantity of 11constitutional changes in government leadership the role of establishments in terms of commitments to and social control of rules root and ahmed 2009; schneider and Frey 2005 the catalyzing impact of aid harms and lutz 2006; kimura and todo 2010 and the stability of basic economics policies business financial and social baniak et al 2005

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