Why does decreasing a credit rating deter Foreign Direct Investment?
Doesn't the credit rating reflect the ability of a nation to pay back debts? However, FDI is investment in the countries firms, not the government. If the credit rating reflects the government's ability to pay back debt, why would that deter investment to firms in the nation?
Second, Where is the limit at which a government finds it necessary to default? How far can a nation go, and why is that the limit?
Investment best answer:
Answer by mattermatics
its an indication of higher risk, and less chance of getting your money back.
Investment
Governors Workforce Investment Board
Image by MDGovpics
Governor O'Malley meets with governor's Workforce Investment Board by Tom Nappi at Anne Arundel Community College,Maryland
Orignal From: Why does decreasing a credit rating deter Foreign Direct Investment? and Governors Workforce Investment Board
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