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The Role of Foreign Investment in Tourism Advancement

The decision to invest is one of the most tough financial decisions and the most hazardous, due to the fact that it is associated with many factors and variables, which are often challenging to anticipate their behavior and trends of development. Foreign investment is the vital and efficient aspect to attain financial and social development, […]

The Role of Foreign Investment in Tourism Advancement

The decision to invest is one of the most tough financial decisions and the most hazardous, due to the fact that it is associated with many factors and variables, which are often challenging to anticipate their behavior and trends of development.

Foreign investment is the vital and efficient aspect to attain financial and social development, as any preliminary increase in investment will cause double and cumulative increases in the interior through the so-called investment multiplier, and an increase in income must go part of it to increase financial investment through the so-called accelerator.

The financial investment has gotten great attention in the literature of economic development since it is among the elements affecting the nationwide item, which in turn stimulates demand for production products, as well as the fluctuations in investment impact earnings and employment.

The field of financial investment represents the type or nature of the activity in which the investor wants to invest his money in order to acquire a return, to put it simply, the entity or area in which the investor plans to invest his cash. When we say domestic and foreign investments we suggest investment, while when we state real estate or securities, we specify the tool used.

Simply put, when we talk about the field of investment, we mean a particular economic sector, while we mean the financial investment tool when we speak about the origin of financial assets or real.

It seems that the investment goes naturally towards countries whose currency is strong and at a consistent high or a minimum of does not fall in the near term and not the countries that struggle with quick inflation and the collapse of the currency, however this guideline is not fixed all the situations and in all places. It is enough that the financier enter his cash in the currency of that nation (ie, the country with a strong currency) and recover it after a period to discover that the value of his money has increased, except for the earnings that came during those cities if he was a citizen of those countries that melt their currency and rise in inflation rates.

In most cases, financial investment in tourism and travel depends on the exact same business principles as in the rest of the economic sectors. However in some cases financial investment in the tourism sector is made for non-commercial factors as in the following cases:

1. Numerous nations purchase the tourism industry for social and ecological factors rather than simply commercial goals.

2. In many cases, institutions such as banks buy the tourist sector for non-commercial purposes, but more notably, the considerable growth in the capital worth of the property compares with those properties whose worth declines over time.

Some financial investments are produced lifestyle factors. Some individuals purchase private yachts, a leisure farm, horseback riding, leisure centers and commensurate with their way of life for individual or social factors.

Internationalization has historically occurred in the economy that exchanges products internationally. To put it simply, the free enterprise preceded the capitalist economy. This internationalization of economic life represents an unbiased trend towards the change of closed domestic markets into open markets worldwide. The collapse of the feudal system and the growing importance of worldwide trade, In the 16th century to the emergence of the elements of business believed whose ideas were crystallized by a group of heterogeneous authors later called the name of the commercialists (Thomas Mann, Jean Colcier), the subjects have actually been taken shape in between the two traders, necessarily The state’s intervention in financial life, to accomplish a proper trade balance that contains surplus with the increase of the state’s financial strength by increasing its population attain an accumulation of psychological minerals money which is the basis of wealth.

The Role of Foreign Investment in Tourism Advancement 2

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