THE INFLUENCE OF ECONOMIC INDICATORS ON THE ADAPTATION OF EUROPEAN OUTWARD FOREIGN DIRECT INVESTMENT

Abstract

The new economic reality has enhanced the evolution of investment activities and the presence of national sectors and industries in the international investment environment (Patel et al., 2024). A key factor in this environment is multinational enterprises (MNEs), which play a key role in the development of foreign direct investment (FDI) (Letsou et al., 2025). The purpose of this paper is to study the resilience and adaptation of the outward FDI (OFDI) from the European Union (EU) countries to the international economic environment. This study more specifically examines the influence of economic indicators — variables on OFDI, while its results lead to useful conclusions regarding the formulation of economic policy and the adaptation of FDI in EU countries. Also, through the use of economic models to process data from the period 1980–2020, the influence of economic indicators of each country on OFDI is examined, as well as their economic adjustment to the international environment. The findings capture the differentiated role of the characteristics of national economies as a determining factor for FDI outflows, highlighting new data and practices regarding countries’ economic policy. This research contributes to the literature on economic adjustment to the international environment and the globalization of the economy by capturing in a comprehensive manner the impact of macroeconomic variables on OFDI.