4.2.4 Foreign Direct Investment and outsourcing

News article

‘Where are the jobs?’: as US autoworkers face offshoring, Democrats vie to win votes

Workers who voted for Trump and Republicans in recent elections are now being hit with offshoring and the impacts of tariffs – but can Democrats sway them?

The Guardian · 1 June 2026

Key terms

• Acquisition
  • The purchase by one company of a controlling interest in another company, often used by TNCs to expand into foreign markets.

• Foreign direct investment
  • Cross-border investment by a firm or individual in one country into business interests located in another, typically through setting up operations or acquiring assets in the foreign country.

• Joint venture
  • A business arrangement in which two or more firms agree to pool resources to undertake a specific project or operation, sharing ownership, risks and returns.

• Offshoring
  • The relocation of a company's business process or production from one country to another, usually to take advantage of lower costs or favourable conditions.

• Outsourcing
  • The practice of a company contracting out part of its business processes or services to an external provider, often located in another country, to reduce costs or access specialist skills.

• Services sector
  • The service sector consists of the production of services instead of end products. Services (also known as "intangible goods") include attention, advice, access and experience.

• Telemedicine
  • The remote delivery of healthcare services using telecommunications technology, allowing diagnosis or treatment by medical professionals located in a different country from the patient.

• Transnational corporation
  • A firm that owns or controls production of goods or services in two or more countries, operating across national borders through subsidiaries, branches or affiliates.