Foreign investment and its effects on domestic economies is a recurring theme in IELTS Writing Task 2, appearing roughly once every 4-5 months in actual tests. Analysis of past papers shows this topic frequently appears in both advantages/disadvantages and discussion essays. Understanding how global financial markets influence domestic economies is crucial for IELTS candidates.
Sample Question Analysis
Some people believe that foreign investment brings only benefits to domestic economies, while others argue it can have negative impacts as well. Discuss both views and give your opinion.
This discussion essay requires candidates to:
- Examine both positive and negative aspects of foreign investment
- Present a balanced analysis
- Provide relevant examples
- State and justify their position
Foreign investment impact discussion showing global business connections
Band 8 Sample Essay
Many believe that foreign direct investment (FDI) is purely beneficial for host economies, while others contend it has drawbacks. In my view, while FDI offers significant advantages, potential risks must be carefully managed.
Foreign investment undoubtedly brings substantial benefits to receiving countries. Firstly, it creates employment opportunities as international companies establish operations locally. For instance, when Samsung built manufacturing facilities in Vietnam, it generated thousands of jobs directly and indirectly through its supply chain. Additionally, FDI facilitates technology transfer and knowledge sharing, enabling domestic firms to adopt advanced practices and improve productivity. However, understanding risks of investing in foreign markets is equally important.
Critics argue that foreign investment can have detrimental effects. One significant concern is that foreign companies may dominate local markets, potentially pushing domestic businesses out of competition. Moreover, there are valid worries about economic dependency, as witnessed in some developing nations where the effects of globalization on labor markets have led to vulnerable economic positions.
In my opinion, while foreign investment’s benefits generally outweigh its drawbacks, proper regulation is essential. Governments should implement policies that protect domestic industries while maximizing FDI’s positive impacts through strategic partnerships and knowledge transfer requirements.
(Word count: 273)
Band 6.5 Sample Essay
Foreign investment is important topic in world economy today. Some people think it only good thing for countries, but others say it can make problems too. I will discuss both sides and give my opinion.
First, foreign investment bring many good things. It give jobs to local people when big companies come to country. For example, many foreign companies in China make lots of jobs for Chinese workers. Also, it bring new technology and knowledge to country. Local companies can learn new ways to do business better.
But there are some bad things too about foreign investment. Sometimes big foreign companies are too strong and local small businesses cannot compete with them. Also, some foreign companies take profits back to their country instead of using in local economy. This not good for country development.
I think foreign investment more good than bad but government must control it careful. They should make rules to protect local business and make sure foreign companies help country grow.
(Word count: 251)
Analysis of Band Scores
Band 8 Essay Analysis
- Task Response (Band 8): Thoroughly addresses all parts of the task with well-developed ideas
- Coherence & Cohesion (Band 8): Clear progression throughout, effective use of cohesive devices
- Lexical Resource (Band 8): Wide vocabulary range used naturally
- Grammar (Band 8): Various complex structures used accurately
Band 6.5 Essay Analysis
- Task Response (Band 6.5): Addresses main points but less developed
- Coherence & Cohesion (Band 6): Basic organization with some cohesive devices
- Lexical Resource (Band 6.5): Adequate vocabulary with some errors
- Grammar (Band 6.5): Mix of simple and complex sentences with errors
Key Vocabulary
- Foreign Direct Investment (FDI) /ˈfɒrən dəˈrekt ɪnˈvestmənt/ (n.) – Investment from one country into another
- Economic dependency /ˌekəˈnɒmɪk dɪˈpendənsi/ (n.) – Reliance on other economies
- Technology transfer /tekˈnɒlədʒi ˈtrænsfɜː/ (n.) – Movement of technical knowledge
- Supply chain /səˈplaɪ tʃeɪn/ (n.) – Network between company and suppliers
- Economic vulnerability /ˌekəˈnɒmɪk ˌvʌlnərəˈbɪləti/ (n.) – Susceptibility to economic shocks
To practice, try writing your own essay about how to promote economic resilience in a global economy. Share your response in the comments for feedback.
