Introduction Over the years, foreign direct investment (FDI) has become a popular way to move capital flows from one country to another. Basically, foreign direct investment simply refers to an instant when a business entity from a particular country invests in an income-generating asset in another country with the hope of a return on investment. Foreign direct investment has its benefits for the foreign investor, the home country, and the host country (Froot 1993, 60). However, it should be noted that the benefits from FDI can only be possible if all three parties follow the right regulations and ethical ways of doing business are strictly adhered to. This paper sheds light on the costs and benefits of foreign direct investment for investors, the home country and the host country. Furthermore, it will also examine the role of the country and the level of development and growth of enterprises in determining the costs and benefits accrued from foreign direct investment (Weigel, Wagal & Gregory 1997, 56). Benefits and Costs to the Host Country One of the The primary benefit of global foreign direct investment is that it creates an opportunity for money to flow freely to any business around the world that shows signs of potential growth in the future. This is in light of the fact that when investors choose to invest their money, the main logic behind this is that they expect some form of return from the investment. Additionally, the home country's capital account will benefit from the inflow from investment returns. There are no standard criteria on who deserves the investment and who doesn't. This ensures that all companies gain the same competitive advantage and that no company is favored over the others. On...... half of the paper...... that the company's workers are fully capable of benefiting from the investment to achieve the company's goals and objectives and therefore a high return on investment . For underdeveloped companies, however, there will be even greater costs resulting from foreign direct investment as investors will be forced to hire new qualified and competent employees or train employees to improve their skill level. In conclusion, it is clear that there is a trade-off between the benefits and costs associated with foreign direct investment. This therefore means that it will be up to the country's government to decide which foreign direct investments will fully benefit the country's economy and which will not. While it may take some time before FDI is fully underway in a country, in the long run it will leave a permanent imprint (Moran 2011, 45)