The impact of investments in global financial crisis

The global financial crisis really started to show its effects in the middle of 2007 and into 2008. Around the world stock markets have fallen, large financial institutions have collapsed or been bought out, and governments in even the wealthiest nations have had to come up with rescue packages to bail out their financial systems. The most important task is to break the spiral of falling asset prices and falling demand and to revive the financial sector’s ability to provide credit for productive investment, to stimulate economic growth and to avoid deflation of prices. In this time of global financial crisis and recession it is essential to keep markets open to international trade and investment. The current global financial crisis is probably the most severe for the world’s financial system since the Great Depression in 1929. This crisis has gone far beyond the financial sector and has seriously affected the real economy. An ample evidence of its negative impacts on FDI has been observed.