The plant now employs 12 people and invoiced over DM 4,000,000 in 1991. Off-shore manufacturing requires greater investment than licensing or joint venture manufacturing, but also affords the greatest amount of control over operations. If you are seriously considering setting up an off-shore manufacturing plant, you will need to assess whether to acquire an existing facility or to construct a new one. The key factors in this decision-making process are the legal and tax ramifications, where to set up operations, and how to finance the foreign investment. An off-shore operation may offer certain tax benefits and other inducements for your company to make an investment in their country.
Some countries actively encourage and promote foreign investment.
Countries receptive to, or in need of, foreign investment may have relaxed laws on kinds and amounts of foreign investments allowed and may even offer certain tax benefits. U.S. and host country attorneys and accountants should be an integral part of the team you assemble to assess whether and where joint venture or off-shore manufacturing would be profitable for your company. Foreign investment requires a substantial commitment of time and money and a certain amount of risk. Recognizing this fact, the United States government created a separate, business-oriented agency to support American investors entering the international marketplace. OPIC is the lead agency assisting U.S. businesses interested in investment overseas.