According to the Organisation for Economic Cooperation and Development, what percentage is fixed to consider an Investment as Foreign Direct Investment?

The Correct answer is 10 Percent.

Key Points

• The Organisation for Economic Cooperation and Development (OECD) sets guidelines and standards for international economic activities.
• According to the OECD, an investment is classified as a Foreign Direct Investment (FDI) when an investor acquires a stake of 10 percent or more in a foreign enterprise.
• This threshold is used to ensure that the investor has significant influence or control over the management of the enterprise.
• FDI is a crucial component for the growth and development of the host country's economy, often bringing in capital, technology, and expertise.
• The 10 percent threshold helps distinguish between a direct investment, which implies a lasting interest, and portfolio investment, which is more of a speculative nature.

 Additional Information

• Organisation for Economic Cooperation and Development (OECD)
  • The OECD is an international organisation that works to build better policies for better lives.
  • It provides a forum in which governments can work together to share experiences and seek solutions to common problems.
  • The OECD's mission is to promote policies that will improve the economic and social well-being of people around the world.
  • The organisation was founded in 1961 and has 38 member countries.