The world economy is experiencing uncertainty. Macroeconomic indicators are weak. Trade tensions and political uncertainty are impacting economic growth. According to the World Bank, in 2019 the worldwide economy grew by 2.4% and in 2020 it is predicted to grow by 2.5%. Amid weaker economic conditions, global foreign direct investment (FDI) declined in 2019 in comparison with 2018. Here we take a look at how the ten countries that attracted essentially the most FDI in 2019
The United Nations Conference on Trade and Development (UNCTAD) has published the Global Investment Trends Monitor report. According to the report, global FDI flows in 2019 were $1.39 trillion, a slight decline from $1.41 trillion in 2018. While some countries saw a pointy decline in foreign investment, others were in a position to attract more foreign investment than ever before.
According to the Global Investment Trends Monitor report, FDI flows in developing economies have remained unchanged and amount to an estimated USD 695 billion. However, FDI flows to advanced economies fell by 6% to $643 billion. A UNCTAD report showed that Latin America attracted 16% more FDI in 2019 in comparison with 2018.
According to the Global Investment Trends Monitor report, listed below are the ten countries that attracted essentially the most FDI in 2019.
10- Germany, $40 billion
Foreign direct investment in Germany greater than tripled in 2019 to $40 billion. The European economic powerhouse attracted just $12 billion in FDI in 2018. According to UNCTAD, inflows into Germany increased as large corporations prolonged loans to their overseas affiliates in a 12 months of slow growth. Germany is a lovely investment destination resulting from its qualified workforce, ease of doing business and advanced infrastructure.
9. Canada, $47 billion
In 2019, FDI inflows to Canada increased by 8% to $47 billion. The increased inflow was primarily resulting from multinational enterprises (MNEs) extending loans to their foreign branches.
8. India, $49 billion
In 2019, the Indian economy experienced a slowdown. However, foreign investors proceed to flow into the country. In 2019, India attracted $49 billion in foreign investment, up 16% from $42 billion in 2018. Most of the FDI went to the services sector, including information technology.
7. France, $52 billion
Paris is considered one of the cities hosting essentially the most international corporations. According to a UNCTAD report, FDI inflows into France increased from $37 billion in 2018 to $52 billion in 2019. This increase may be attributed to multinational corporations extending more loans to their foreign affiliates.
6. Hong Kong, $55 billion
Hong Kong, a special administrative region of China, consistently ranks among the many countries attracting essentially the most FDI. However mass protests in 2019, it hurt the inflow to Hong Kong not only of tourists but in addition of foreign investment. FDI inflows fell by 48% from $104 billion in 2018 to $55 billion in 2019.
5. Great Britain, $61 billion
Another country that recorded a decline in FDI inflow over the 12 months was Great Britain. In 2019, it received foreign investment price $61 billion, up from $65 billion in 2018. FDI inflows were impacted by the Brexit saga. As Brexit unfolds, several large and small businesses are relocating from the UK to other European countries. The country boasts an efficient labor market, a talented workforce and a solid economic system.
4. Brazil, $75 billion
Total FDI flows to Latin America and the Caribbean increased by 16% in 2019 to $170 billion. Brazil alone accounted for 44% of this amount. Foreign investment in Brazil increased by 26% from $60 billion in 2018 to $75 billion in 2019. The country’s privatization program has opened up recent investment opportunities for foreign investors.
3- Singapore, $110 billion
Singapore stays a lovely investment destination in these uncertain times. FDI inflows into Singapore increased by 42% from USD 78 billion in 2018 to USD 110 billion in 2019. This is considered one of the the largest winners within the US-China trade war. Singapore is renowned for its world-class infrastructure, ease of doing business, transparency and a solid economic system.
2- China, $140 billion
China was the second largest recipient of foreign direct investment in 2019. FDI inflows into the country amounted to $140 billion in 2019 and $139 billion in 2018. Despite being the world’s second largest economy, China proceed to grow at a healthy pace as they move away from exports and towards domestic consumption.
1- United States, $251 billion
The United States once more topped the list of nations that attracted essentially the most FDI. FDI flows into the U.S. declined barely from $254 billion in 2018 to $251 billion in 2019. The largest investors within the US were Germany, Japan and the Netherlands. Investments from Canada fell by 24% and from the European Union by 6%.
Looking ahead, the UNCTAD report predicts a moderate increase in global FDI in 2020. Improving macroeconomic conditions in 2020 and 2021 will encourage multinational corporations to resume investment in productive assets. However, the world still faces geopolitical threats, protectionist policies and high debt levels in developing countries.
