Dear Colleagues,

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

The key message: Global FDI flows continue their slide in 2018; Rebound expected in 2019, but underlying trend remains weak.

•           Global foreign direct investment fell by 19% in 2018, to an estimated US$1.2 trillion. The third consecutive drop brings FDI flows back to the low point reached after the global financial crisis.
•           The decline was concentrated in developed countries where FDI inflows fell by 40%, mainly due to large repatriations of accumulated foreign earnings by United States MNEs, following tax reforms. A decrease was also reported in the United States (-18%).
•           In contrast, FDI to developing economies remained resilient, with an increase of 3% to US$694 billion. The share of developing economies in global FDI reached 58%. Half of the top 10 host economies are developing economies.
•           Among developing regions, flows increased by 5% in developing Asia and 6% in Africa (although growth there was concentrated in very few countries) but declined in Latin America and the Caribbean (-4%). East and South-East Asia was the largest host region, accounting for one-third of global FDI in 2018 and almost all of the growth in FDI to developing economies. FDI to the transition economies declined by 8% to US$44 billion.
•           Looking ahead, a rebound is likely in 2019 but the underlying trend remains weak. On the positive side, greenfield project announcements – an indicator of future trends – increased by 29%, albeit from relatively low levels in 2017. Also, as repatriations abated in the third quarter of 2018, developed country inflows will revert to normal levels. However, increased risks are emerging from recent downward revisions in growth forecasts and from policy factors, including trade tensions and uncertainty about the global policy environment for investment.

For the latest issue of the Global Investment Trends Monitor please click here. An in-depth analysis of FDI trends will feature in the forthcoming World Investment Report 2019, to be published in June 2019.

Best regards,
 
James X. Zhan
Director, Investment and Enterprise
Lead, World Investment Report
United Nations Conference on Trade & Development
Palais des Nations, Geneva
http://www.unctad.org/wir
http://www.worldinvestmentforum.org
http://investmentpolicyhub.unctad.org