Dear Members of the World Investment Network,
It is my pleasure to share with you the latest issue of UNCTAD's Global 
Investment Trends Monitor (GITM).

The key message: global FDI continued to rise in 2011 despite economic 
uncertainties;  however, prospects remain guarded.   Outward FDI by 
developed-country multinationals increased, but outward FDI by 
developing-country multinationals appears to have lost some momentum.

Global FDI outflows (the focus of this issue of the GITM) rose by 16 per 
cent in 2011, to an estimated US$1.66 trillion, just surpassing the 
pre-crisis level, but still 25 per cent short of the 2007 peak. 

The growth of FDI outflows in 2011 was due in large part to cross-border 
acquisitions and increased cash reserves kept in foreign affiliates, 
rather than the much-needed direct investment in new productive assets 
through greenfield investment or expansion of existing foreign affiliates.

Outward FDI from developed countries rose by 25 per cent, exceeding 
US$1.23 trillion, with the European Union, North America and Japan all 
contributing to the growth. United States TNCs increased cash holdings in 
their foreign affiliates in the form of reinvested (retained) earnings. 

FDI outflows from developing countries fell by 7 per cent mainly due to 
significant declines in outward FDI from Latin American and the Caribbean 
and a slow down in the growth of investments from developing Asia. As a 
result, the share of developing and transition economies in global FDI 
outflows declined from 31 per cent in 2010 to 26 per cent in 2011. 
Nevertheless, the outward FDI from developing and transition economies 
remained important, at its second highest level recorded ever.

Prospects for FDI outflows in 2012 continue to improve since the depth of 
the crisis, but they remain guarded due to the fragility of the global 
economic recovery.

For your information, the next issue of UNCTAD's Investment Policy Monitor 
will be released in May 2012. 

James X. Zhan
Investment & Enterprise Division
United Nations Conference on Trade & Development
Palais des Nations, Geneva
Tel: +41 22 9175797


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