Foreign direct investment refers to the investment made in a
host country by a firm or an entity based in another country.
A country is called a source and a recipient of FDI together as
it aims at buying a company in a target host Country by expanding
the operations of an existing business in that country.
As the target country is where the entity focuses for purchase
of an existing business, that country is considered as a source of
FDI and it is called a recipient as expansion of business by a
foreign entity occurs in that same country.
The developing countries are usually considered as a source and
recipient of FDI as they have the ability to retain and leverage
the investments for sustainable growth rather than just attracting
them.