Developing nations among top FDI recipients in 2014
Global Foreign Direct Investment (FDI) inflows in 2014 fell by 16% to $ 1.23 trillion due to weak global economy, policy uncertainty for investors, among other reasons, said the World Investment Report 2015, released at the United Nations Conference on Trade and Development (UNCTAD). However, developing economies extended their lead in receiving FDI inflows, by occupying five positions among the top ten FDI recipients during the year. Inward FDI flows to the developing economies reached highest level ever at $681 billion registering a 2% rise in 2014, noted the report. The report further says that investments made by the Multi National Enterprises (MNEs) from the developing countries also reached a record level and Asia, now stands as a top investing region than any other globally. Nine of the twenty largest investors were seen from developing economies and the MNEs continued their way of acquiring foreign affiliates from developed nations. Meanwhile, the groupings formed by the individual regions for regional cooperation witnessed a fall in inflows in 2014. While countries negotiating Transatlantic Trade and Investment Partnership (TTIP) and Trans-Pacific Partnership (TPP) witnessed combined share of decline in global FDI inflows, the Association of Southeast Asian Nations (ASEAN) and Regional Comprehensive Economic Partnership (RCEP) groupings witnessed a positive trend with 5% increase to $133 billion and 4% increase to $363 billion respectively. Coming to the regional-wise investment trends, while flat trend continued in case of Africa, developing Asia witnessed 8% rise, Latin America and Caribbean witnessed a 14% drop in FDI inflows, among others. Going further into Asian region, the FDI inflows into East Asia and South-East Asia increased by 10% in 2014 helped by MNEs’ efforts towards cross-border investment in infrastructure aimed at enhancing regional connectivity. According to the report, the FDI recovery is in sight and the global FDI inflows are expected to grow by 11% to $1.4 trillion in 2015, further to $1.5 trillion in 2016 and $1.7 trillion in 2017.
June 25, 2015 | 11:10 am IST.