How institutional voids influence Brazilian foreign direct investment in Angola

How do institutional voids influence emerging market multinationals (EMNEs) foreign direct investment (FDI) in developing countries? In this article we respond to this question by examining Brazilian FDI in Angola as our analytical setting. We focus on the host country’s institutions and its institu...

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Published inInternext Vol. 12; no. 1; pp. 33 - 47
Main Authors Virches, Renato, Cahen, Fernanda Ribeiro
Format Journal Article
LanguageEnglish
Published Sao Paulo Assoc. Escola Superior de Propaganda e Marketing 01.01.2017
Escola Superior de Propaganda e Marketing - ESPM
Subjects
Africa
Brazilian FDI
Developing countries
Foreign investment
Host country
Institutional voids
Internacionalização de Empresas
Internationalization
LDCs
Multinacionais Brasileiras
Multinacionais de países emergentes
Multinational corporations
Multinationals from emerging markets
Brazil
Angola
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Summary:How do institutional voids influence emerging market multinationals (EMNEs) foreign direct investment (FDI) in developing countries? In this article we respond to this question by examining Brazilian FDI in Angola as our analytical setting. We focus on the host country’s institutions and its institutional voids as essential factors that attract the FDI of EMNES to developing countries. The research indicates that Brazilian companies fill in much of these voids within the market intermediaries, often creating a point of competitive advantage, and also creating advantages in relation to FDI from other economies that invest in Angola. The scarce literature on FDI in Africa has been largely dedicated to the analysis of Chinese investment in the region. We aim to complement recent research on the influence of the host country’s institutions on the behavior of FDI in developing countries, explaining how some EMNEs are able to use the institutional voids of developing countries as market opportunities. Our findings should provide also implications for EMNEs managers from other emerging markets by providing a better understanding of how Brazilian multinationals expand their business in less developed countries, handle institutional voids and manage relationships with local and foreign institutions in the host country.
ISSN:1980-4865
1980-4865
DOI:10.18568/1980-4865.12133-47