Investment is the flow of capital which is used for productive purposes, especially by private firms, or for public use in the case where the government invest money in roads, infrastructure, schools, health etc. We can define them as private and public and investments respectively.
Investment falling under the first definition (by private sector) can be domestic or foreign (coming from abroad by multinational companies for example).
Investors bring fresh capital, technology, competitiveness, new markets and trade; they also bring jobs. This in turn creates demand and spending which in turn stimulate the whole economy and growth of a country.
Level of investment depends on the current interest rates applied by a country since most of the investment require a loan from banks.
Technology in certain cases can increase unemployment since labour is less necessary per unit of production. But by contrast, other kinds of investment and economic situations which give rise to an increasing employment.
Public investment is obviously having a long term and wide impact and utility for a large portion of the population and determines also the quality of future generations (especially in the educational sector which create professional and competent human resources for the country).
Investments therefore helps to create a robust economy. That is why it is important for a country.
Hope this has helped. Welcome. Cheers
Flavio - Multiflavour
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