Global foreign direct investment (FDI) to developed economies declined by 21% in 2022, reflecting global economic and political instability, according to the UN Conference for Trade and Development (UNCTAD) World Investment Report, a flagship annual publication.
Meanwhile, investment to developing economies rose by 7% overall, with the group accounting for a record two-thirds of all global FDI. Greenfield project announcements across these countries rose by 37% in number, almost doubling in value.
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FDI flows to developing Asia did particularly well, reaching a record $652bn in 2022 – 5% higher than the previous year – and accounting for almost half of global FDI. China remained the world’s second-largest host for FDI after the US.
FDI in South Asia rose by 10% to $58bn. Flows to India – the largest country in the sub-region – rose by 12% to $50bn in terms of new greenfield project announcements (doubling to 1,008 projects, which makes it the third-largest recipient worldwide), while also rising 64% in international project finance deals to 187, thereby ranking the country second worldwide.
Flows to Latin America and the Caribbean rose by 4%, reaching $202bn – thereby recovering 2020’s lost ground fully and reaching the second-highest level ever recorded. The rise of commodity prices pushed up reinvested earnings in Brazil to record levels.
Following a record year in 2021, FDI to Africa fell by 44% to $45bn due to a single intra-company financial transaction in South Africa. Despite the decrease, flows into Africa in 2022 were similar to the ten-year average before 2021.
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