The effect of foreign direct investments on export performance in European Union countries: (1990-2018)

Foreign direct investments (FDI) have been seen as a life preserver after World War II by developing countries in order to ensure their economic growth and development. Foreign direct investments in a country can be effective in expanding the production of the host country and consequently in the increase of exports thanks to the advantages such as new technology, know-how, marketing methods, knowledge and skills transferred to that country. This is important in terms of showing that foreign direct investments have the power to affect exports. In this context, the aim of this study is to investigate the effect of FDI on export performance in European Union (EU) countries. For this purpose, 12 EU countries with regular data set were selected as samples. The data of these selected countries are from the period of 1990-2018 and the relationship between the variables was analyzed by using panel data analysis method. According to the results of the analysis, FDI positively affects exports in the mentioned countries. According to these findings, it is important that EU countries focus on the policies that will attract FDI. Keywords: Foreign Direct Investment, Export, European Union