ATTRACTING FOREIGN DIRECT INVESTMENT IN DEVELOPING COUNTRIES: WHY BOSNIA AND HERZEGOVINA SHOUD BE LEARNING FROM CHINA

The importance of capital inflows and outflows is something that country needs and encourage it to help the economies of countries to grow at a steady rate. The purpose of this study is to provide a framework and to explain what main drivers of FDI in the world are and what policies should be made to encourage the FDI in BiH. Main limitations of this study would be that, since this is rather an extensive study, it will not be able to cover all factors in-depth, but the author will try to explain in great detail the ones that she considers to be of great importance for Bosnia and Herzegovina. The author will examine factors that China took into consideration as it's incentives for attracting FDI. Furthermore, this study will show what the main factors are influencing the FDI of other countries and how Bosnia can improve its policies and change them to attract FDI.