Global FDI flows in 2016 came to $1520bn, a 13% decrease from the previous year as economic growth and world trade volumes remain weak, reports Unctad in its latest Global Investment Trends Monitor. A modest recovery is predicted for 2017 with an estimated 10% increase in global flows.
The 2016 decline in FDI was unevenly distributed across regions. "FDI flows to Europe fell 29% to an estimated $385bn, with a number of countries experiencing strong volatility in their inflows," the report found. "This decline was tempered by modest growth in flows to North America (6%) and a sizeable increase in investment in other developed economies, principally Australia and Japan."
Inflows to developing economies fell 20% to an estimated $600bn according to Unctad figures. Transition economies, by contrast, saw a 38% rise in FDI flows to an estimated $52bn.
Unctad secretary-general Mukhisa Kituyi said: "Looking ahead, economic fundamentals point to a potential increase in FDI flows by about 10% in 2017. However, significant uncertainties about the shape of future economic policy developments could hamper FDI in the short term."