Foreign direct investment and profit repatriation: The Mexican-German experience

• Applicant: Professor Dr. Christof Parnreiter
• Subject Area: Human Geography ; Economic Policy, Applied Economics
• Term: since 2026
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 567651612

The proposed project investigates the repatriation of FDI profits from Mexico, with a particular focus on profit flows to Germany and, in terms of sectors, on the manufacturing industry. Profit repatriation, despite its scale and relevance to development policy, is a little-studied topic, which is why this project promises to close a major empirical research gap and make valuable scientific and policy-relevant contributions to development research. Specifically, the project is divided into three work packages that make use of different methods: WP1 examines on the basis of quantitative data (including WP1 examines the gross and net flows of FDI profits (German team) on the basis of quantitative data (including from the balance of payments statistics of EU countries); WP2 focuses on Mexico as a profit-generating country, with a focus on a) the generation of profits, b) the strategies that lead to repatriation, and c) why the return flow from Mexico is very high in absolute terms, but relatively low in comparison with other developing economies (Mexican team); WP3 deals with the use of repatriated profits in Germany and, on the Mexican side, with the economic consequences of the outflow of profits. The aim of the project is the scientific and political visualization of this direct but so far empirically completely neglected form of value transfer and the initiation of new debates on the (under)development potential of FDI.

• DFG Programme: Research Grants
• International Connection: Mexico
• Partner Organisation: Universidad Nacional Autónoma de México (UNAM)
• Cooperation Partner: Professor Dr. Roberto Valencia Arriaga