Dear Members of the World Investment Network (WIN),

It is my pleasure to share with you the latest issue of UNCTAD's Global Investment Trend Monitor.

The key message: Global FDI rose by 11%; developed economies are trapped in a historically low share.

·        Global foreign direct investment (FDI) inflows rose by 11% in 2013, to an estimated US$1.46 trillion – a level comparable to the pre-crisis average – reaching the upper range of UNCTAD's forecast.

·        FDI flows to developed countries remained at a historically low share of global total FDI flows (39%) for the second consecutive year. They increased by 12% to US$576 billion, but only to 44% of their peak value in 2007. FDI to the European Union (EU) increased, while flows to the United States continued their decline.

·        FDI flows to developing economies reached a new high of US$759 billion, accounting for 52% of global FDI inflows in 2013. At the regional level, flows to Latin America and the Caribbean, and Africa were up; developing Asia, with its flows at a level similar to 2012, remained the largest host region in the world.

·        FDI inflows to transition economies also recorded a new high of US$126 billion – 45% up from the previous year, accounting for 9% of global FDI inflows.

·        Among major regional and inter-regional groupings, APEC and BRICS almost doubled their share of global FDI inflows over the past ten years. APEC now accounts for more than half of global FDI flows, on a par with the G20, while BRICS jumped to over one fifth. In ASEAN and MERCOSUR, the level of FDI inflows doubled compared to the pre-crisis level.

·        The three mega regional integration initiatives – TTIP, TPP and RCEP – show diverse FDI trends. The combined share in global FDI inflows of the United States and the EU, which are negotiating the formation of TTIP, nearly halved from 56% ten years ago to 30% in 2013. The share in global FDI inflows of the 12 countries participating in the TPP negotiations was 28% in 2013, markedly smaller than their share in world GDP of 40%. RCEP, which is being negotiated between the ten ASEAN Member States and their six FTA partners, accounted for more than 20% of global FDI flows in recent years, nearly twice as large as at the pre-crisis level.

·        UNCTAD forecasts that FDI flows will rise gradually in 2014 and 2015, to US$1.6 trillion and US$1.8 trillion respectively, as global economic growth gains momentum which may prompt investors to turn their cash holdings into new investments. However, uneven levels of growth, fragility and unpredictability in a number of economies, and the risks related to the tapering of quantitative easing measures could dampen the FDI recovery.

For the latest issue of the Global Investment Trends Monitor and the UNCTAD Investment Policy Monitor, please click here. For the latest World Investment Report, please click here.

Please note that the UNCTAD World Investment Forum 2014 will take place in the Palais des Nations, Geneva, 13-16 October 2014.  

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