FDI and Enterprise's Technical Capability

Foreign direct investment (FDI) is a significant drive for economic growth. However, it does not mean that FDI will definitely bring small and medium enterprises technology advancement; there is not a positive correlation between FDI and technology advancement. Being a potential stimulus for technology advancement, FDI produces technology spillover effects under the constraint of multiple factors, such as absorptive capability of enterprises, human capital, and economic environment. Therefore, the technology improvement in small and medium enterprises must depend on strengthened FDI management based on various constraints.