Wed. Dec 2nd, 2020

ANKARA: A new United Nations (UN) report revealed that global foreign direct investment (FDI) flows dropped by 49 percent in the first half of 2020, compared to the same period last year, due to the coronavirus pandemic.

James Zhan, investment and enterprise director at the UN Conference on Trade and Development (UNCTAD), said the decline is more drastic than they expected, particularly in developed economies.

“Developing economies weathered the storm relatively better for the first half of the year. The outlook remains highly uncertain,” he said in the report published on Tuesday.

According to the report, developed countries saw the biggest fall, with FDI reaching an estimated $98 billion in the first six months, a decline of 75 percent compared to 2019.

“Meanwhile, the 16-percent decrease in FDI flows to developing economies was less than expected, due mainly to resilient investment in China,” it said.

Foreign direct investment flows to North America, Asia, and Africa fell by 56 percent, 12 percent, 28 percent, respectively, and Latin America and the Caribbean by 25 percent, compared to the same period in 2019.

The report also indicates that outlook for this year remains negative with the estimation of 30- to 40-percent decline in foreign direct investment flows.

UNCTAD, however, predicts foreign direct investments to developed countries would likely to flatten as some investment activities appeared in the third quarter. 

According to the report, flows to developing economies are expected to stabilize as East Asia shows signs of a recovery. TASS

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