The restoration of economic and political stability that would strengthen investor confidence and encourage business investment plans, the rapid shift of the domestic production model from non-tradable to tradable goods and services and the easing of financing constraints are instrumental in stimulating business investment expenditure.
These considerations suggest that the current pattern of international capital flows represents a win-win scenario: Developing economies gain access to better financial services, and industrial economies enjoy the larger quantities of imports they can purchase with this financing. These explanations also suggest that the uphill flow of capital will be reversed to the extent that financial systems of emerging-market economies develop and improve.