FDI & Neccesity for Govermental Reform: Albanias case

Foreign Direct Investment is an integral part of an open economical system and a major katalisator of economic development. However, the benefits of FDI do not happen automatically and not disperse evenly among communities. National politics and the international structure of investment do matter for the attraction of FDI¿s into an ever growing number of developing countries and for a better absorption of the positive potential of those investments into sustainable growth. Challenges mainly are on the side of host countries, which have to create an open, transparent environment, that is clear and effective politics for the attraction of such investments and to build human and instructional infrastructure for the proper implementation of such politics. The role FDI¿s plays for guiding economic development and economic growth has ever been a contested one. Since the beginning there have been viewpoints in favor and against FDI. Some authors, argues that FDI led to economic growth and increase of productivity and hence to economic development, but others note the risk of FDI in destroying local capacities or over- exploiting the natural resources.