Automobile Industry in Oman
No. 8 24 January 2012
GLOBAL FLOWS OF FOREIGN DIRECT INVESTMENT EXCEEDING PRE-CRISIS LEVELS IN 2011, DESPITE TURMOIL IN THE GLOBAL ECONOMY HIGHLIGHTS
Despite turmoil in the global economy, global foreign direct investment (FDI) inflows rose by 17 per cent in 2011, to US$1.5 trillion, surpassing their pre-crisis average, based on UNCTAD estimates (figure 1).
Figure 1. Global FDI flows, average 2005 2007 and 2007 to 2011 (Billions of US dollars)
1 969 1 744 1 480 1 472 1 180 1 290 1 509
740
0 pre-crisis average 2005-2007 2007 2008 2009 2010* 2011**
Source: UNCTAD. * Revised. ** Preliminary estimates.
FDI inflows increased in all major economic groupings developed, developing and transition economies Developing and transition economies continued to account for half of global FDI in 2011 as their inflows reached a new record high, at an estimated US$755 billion, driven mainly by robust greenfield investments. In this group, the 2011 increase in FDI flows was no longer driven by South, East and South-East Asia (which saw an increase of 11 per cent), but rather by Latin America and the Caribbean (increase of 35 per cent) and by transition economies (31 per cent). Africa, the region with the most least developed countries (LDCs), continued its decline in FDI inflows.
FDI flows to developed countries also rose by 18 per cent, but the growth was largely due to cross-border merger and acquisitions (M&As), not the much-needed investment in productive assets through greenfield investment projects. Moreover, part of the M&A deals appear to be driven by corporate restructurings and a focus on core activities, especially in Europe. Looking forward, UNCTAD estimates that FDI flows will rise moderately in 2012, to around US$1.6 trillion. However, the downward quarterly trend in FDI projects over the final quarter of 2011 indicates that the risks and uncertainties for further FDI growth in 2012 remain in place.
Global FDI flows rose in 2011, surpassing their
GLOBAL FLOWS OF FOREIGN DIRECT INVESTMENT EXCEEDING PRE-CRISIS LEVELS IN 2011, DESPITE TURMOIL IN THE GLOBAL ECONOMY HIGHLIGHTS
Despite turmoil in the global economy, global foreign direct investment (FDI) inflows rose by 17 per cent in 2011, to US$1.5 trillion, surpassing their pre-crisis average, based on UNCTAD estimates (figure 1).
Figure 1. Global FDI flows, average 2005 2007 and 2007 to 2011 (Billions of US dollars)
1 969 1 744 1 480 1 472 1 180 1 290 1 509
740
0 pre-crisis average 2005-2007 2007 2008 2009 2010* 2011**
Source: UNCTAD. * Revised. ** Preliminary estimates.
FDI inflows increased in all major economic groupings developed, developing and transition economies Developing and transition economies continued to account for half of global FDI in 2011 as their inflows reached a new record high, at an estimated US$755 billion, driven mainly by robust greenfield investments. In this group, the 2011 increase in FDI flows was no longer driven by South, East and South-East Asia (which saw an increase of 11 per cent), but rather by Latin America and the Caribbean (increase of 35 per cent) and by transition economies (31 per cent). Africa, the region with the most least developed countries (LDCs), continued its decline in FDI inflows.
FDI flows to developed countries also rose by 18 per cent, but the growth was largely due to cross-border merger and acquisitions (M&As), not the much-needed investment in productive assets through greenfield investment projects. Moreover, part of the M&A deals appear to be driven by corporate restructurings and a focus on core activities, especially in Europe. Looking forward, UNCTAD estimates that FDI flows will rise moderately in 2012, to around US$1.6 trillion. However, the downward quarterly trend in FDI projects over the final quarter of 2011 indicates that the risks and uncertainties for further FDI growth in 2012 remain in place.
Global FDI flows rose in 2011, surpassing their