A noteworthy characteristic of the contemporary global economy is the uneven distribution of world foreign direct investment (FDI). While in the first global economy before 1929 most FDI was located in developing countries, currently threequarters of world FDI is located in developed countries. Large emerging economies with little inward FDI include India and Turkey, despite the relaxation over the last two decades of the restrictions imposed on foreign firms between 1950 and 1980. This working paper explores why Unilever, the Anglo-Dutch consumer products company, was able to sustain large businesses in those countries even in the postwar era of hostility to foreign multinationals. It argues that the explanation is multi-causal. Unilever held first-mover advantages in both countries, but it was also prepared to
accept low dividend remittances for years. It pursued flexible business strategies beyond its "core" business, even distributing condoms. It maintained a high standard of corporate ethics. It was effective at building contacts with local business and government elites, primarily through localization of management. In short, it took an extraordinary effort by a very large and experienced global corporation to survive the “era of confrontation” which deterred most other foreign firms, and which has left behind a legacy of distrust which helps to explain the continuing low levels of FDI in India and Turkey.