A stable economic and political environment is necessary for firms to feel secure while making long-term investment decisions, such as those related to investing in foreign countries (also known as foreign direct investment or FDI). Any threat to change legislative procedures in the foreign country can make it difficult for firms to predict the outcomes of such decisions. Populist leaders, who claim to represent the will of the people, often come to power by threatening to alter the established rules and procedures, generating a more uncertain landscape for multinationals.
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Source: Phys.org