FX NPV as a result of FDI is a major part of ACCA AFM. It comes under one of the two syllabus areas that must be examined to some extent.
The IMF recently released a report on related area that will enhance your professional skills under acumen.
Friendshoring’ is a risk to growth and financial stability, warns IMF Fund points to foreign direct investment increasingly flowing between countries that are geopolitical allies.
Rising geopolitical tensions have triggered a reshaping of global investment that threatens to depress growth and raise the risk of financial instability, the IMF has warned.
In reports published last Wednesday, the fund noted that foreign direct investment was increasingly flowing between countries that were geopolitical allies rather than those that were geographically close.
There had been a notable decline in investment between the US and China since 2015 as the countries increasingly view each other as strategic rivals.
The fund also found that the increased tensions between the world’s two largest economies had reduced their hot money flows and bank lending by around 15 per cent.
While increasingly locating capital in friendly countries — a phenomenon known as “friendshoring” — might improve political security, the IMF warned that the trend was likely to reduce the diversity of risks, amplifying the chances of economic downturns.
(Source of this blog came from a recent Financial Times article which I have adapted for ACCA AFM students).
