FDI to decline by 2% globally in 2023 | Economy | Markets | Foreign Investment | World Economy | Financial flows | UN | United Nations | | Economy

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Los Foreign investments Direct investments declined by 2% to represent USD 1.33 trillion in 2023, although this result reflects the impact of strong fluctuations. Financial flows In a small group European economiesIf set aside, there would be a 10% drop in global investments compared to a year ago.

Moderate forecasts for the global economy pointed to geopolitical tensions (many active armed conflicts) as reasons. Changes in industrial policies and supply chains.

In this context, large corporations and companies have been more cautious when implementing expansion plans, according to a report by the organization’s director general, Rebecca Grinspan, this Thursday in Geneva.

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The UN trade and development chief said the development was particularly difficult for developing countries, which saw foreign direct investment decline. 7% (up to US$867,000 million), with variations between regions, with Latin America holding up the best with a drop. 1%Faced with decline 8% Asia and 3% In Africa.

This shows that developing economies have failed to generate the expected impact of policies aimed at attracting investments (86% of all adopted by 2023).

Grynspan offered one explanation for weak foreign direct investment in developing countries “The perception that they are persistently dangerous is an image that risk assessment agencies contribute to.”.

In developed economies, foreign investments increased 9%, but this positive result was mainly due to activity in Ireland, Luxembourg, the Netherlands, Switzerland and the United Kingdom. If these countries are excluded from the calculation, Europe experiences a 14% Investments are lower in 2023 than the previous year.

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In the United States, the world’s leading economy, there was a decline 5%This is partially explained by the significant reduction in cross-border acquisition and merger activity, which also applies in the European case.

All this in a rather protectionist environment, which was the backdrop 57% The policies adopted in this area in developing countries have either restricted foreign investments in some way or seek to filter them more severely.

In his analysis of trends, Grinspan also “Severe Decline” In financing related to sustainable sectors, both finance and bonds, related to achieving the Sustainable Development Goals by 2030.

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