The push for a greener and more digital future has been consolidated as investments flow into renewable energy, data centres and electronic components, according to data from greenfield investment tracker fDi Markets.
The renewable energy sector emerged once again as the biggest recipient of foreign direct investment (FDI) in the first six months of 2021, when foreign investors announced projects in clean energy technologies worth a total of $33.5bn, according to the latest fDi Markets estimates.
However, this figure was just shy of the $35.2bn ten-year average and down by 41.3% on the record $57.1bn tracked in the first six months of 2020, fDi Markets figures show. Overall capital investments into greenfield FDI in 1H21 were down by 20% on last year.
The largest of these was Enegix Energy’s $5.4bn investment into a green hydrogen project in Ceará in Brazil. The other large-scale project in clean energy was Portuguese electric utility firm Energias de Portugal’s announcement of plans to invest more than €1bn to develop renewable energy projects in the Galicia region of Spain by 2030.
Both projects classified are as ‘other electric power generation’ by fDi Markets, reflecting the move away from individual solar and wind projects and the integration of green hydrogen into project announcements.
In line with the paradigm shift away from fossil fuels by investors, projects announced thus far in 2021 in coal, oil and gas stood at a mere $3.1bn — down by roughly 87.3% on the same period last year, according to fDi Markets.
Real estate and communications trailed renewable energy in terms of total investment figures for the first half of the year, coming in at $23.1bn and $20.7bn respectively.
Investments into real estate were bolstered by $13.4bn in announced projects in industrial building construction, mostly in commercial warehousing and logistics, thanks to the gains made in e-commerce, fDi Markets figures show.
Meanwhile, investments in data processing, hosting and related services, which stood at $13.4bn and largely consisted of data centre projects, made communications the third-biggest sector during this period.
Parallel to the communications and real estate sectors, the software and IT services and transportation and warehousing sectors welcomed $14.4bn and $12.9bn worth of project investments.
More capital investment went into electronic components in the first six months of 2021 than in the first 11 months of 2020, according to fDi Markets, reflecting the need from renewable energy developers and hardware manufacturers alike.
More than half of the $19.3bn investment into electronic components came from Risen Energy investing $10.1bn to open a factory in the Kulim high-tech park economic zone in Malaysia.
The semiconductor and automotive OEM sectors have also benefited from the demand for electric products, with $4.2bn of the semiconductor investments going into batteries and more than half of the automotive original equipment manufacturer investments in electric vehicles, fDi Markets figures show.