{"id":30737,"date":"2019-03-25T14:04:10","date_gmt":"2019-03-25T13:04:10","guid":{"rendered":"https:\/\/nationalwire.com.ng\/?p=30737"},"modified":"2019-03-25T14:04:10","modified_gmt":"2019-03-25T13:04:10","slug":"nigeria-others-get-40b-as-global-fdi-falls-to-1-2tr","status":"publish","type":"post","link":"https:\/\/nationalwire.com.ng\/sub\/nigeria-others-get-40b-as-global-fdi-falls-to-1-2tr\/","title":{"rendered":"Nigeria, Others Get $40b As Global FDI Falls To $1.2tr"},"content":{"rendered":"

Global foreign direct investment (FDI) fell by nearly a fifth in 2018, to an estimated $1.2 trillion from $1.47 trillion in 2017, according to the latest UNCTAD Global Investment Trends Monitor released on Monday, with Nigeria and Angola experiencing weak performance.<\/p>\n

The drop, the third in as many years, brings FDI flows back to the low point reached after the global financial crisis, with the decline concentrated in developed countries where inflows fell by as much as 40% to an estimated $451 billion.<\/p>\n

UNCTAD shows that FDI to developing economies increased by three per cent to $694 billion in 2018, and accounted for half of the top 10 host economies for FDI inflows.<\/p>\n

Of the developing economies, Asia and Africa benefited the most, with flows increasing to developing countries in Asia by five per cent.<\/p>\n

The slight increase in FDI to Africa ($38 billion in 2017 to $40 billion in 2018), was driven by strong performance in Egypt, and South Africa and weak performance in Nigeria, and Angola.<\/p>\n

Specifically, South Africa recorded 446% increase, Egypt up by 7%, while Nigeria was down by 36% (to $2.2.bn in 2018 and was overtaken by Ghana who received $3.3bn).<\/p>\n

\u201cThe underlying FDI trend has shown anaemic growth since the global financial crisis, and has been on a downward trajectory since 2013,\u201d James Zhan, Director of UNCTAD\u2019s Investment Division said.<\/p>\n

\u201cThe factors behind this negative trend, such as lower profitability of foreign investment and shifts in global value chains, are not changing in the near future. The macro-economic backdrop is also deteriorating,\u201d he said.<\/p>\n

According to UNCTAD, the 2018 FDI decline stems from corporate income tax reform in the United States. From 2017, U.S. multinational enterprises have embarked on a large repatriation of accumulated foreign earnings, a move which has hit Europe hard.<\/p>\n

In 2018, Europe\u2019s foreign investment inflows amounted to $100 billion \u2013 an unprecedented 73% decline \u2013 and a value last seen in the 1990s. The U.S. also saw its inflows dip to $226 billion, a decline of 18%.<\/p>\n

In contrast, global cross-border mergers and acquisitions were up 19%, and announced greenfield investments were positive, up 29%, indicating that FDI could improve in 2019. Meanwhile, developing economies\u2019 FDI flows have been more resilient.<\/p>

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East and South-East Asia, where inflows were up two per cent and 11% respectively, took the lion\u2019s share of foreign investment, accounting for one-third of global FDI in 2018, and almost all growth in FDI to developed economies.<\/p>\n

\u201cSouth East Asia is the main FDI growth engine,\u201d said Mr. Zhan, with the region rebounding from a dip in 2017, buoyed by growth in Indonesia and Thailand.<\/p>\n

Greenfield announcements in developing economies rose by 47% reaching an estimated $539 billion and linked to Asian growth prospects.<\/p>\n

African FDI flows were up six percent, though growth was concentrated only in a few countries such as Egypt and South Africa.<\/p>\n

\u201cSlow economic recovery in Latin America and the Caribbean saw flows drop by four per cent,\u201d Mr. Zhan added.<\/p>\n

While the outlook is more positive for 2019 with a rebound expected, Mr. Zhan said there are still many uncertainties facing the global economy.<\/p>\n

\u201cBeyond the immediate impact of economic headwinds, the underlying trends for global FDI remain weak, driven by one-off factors such as tax reforms, megadeals and volatile financial flows,\u201d says Zhan.<\/p>\n

\u201cAs the initial flood of earnings repatriations in the United States abate, things will normalise rebounding to \u2018average\u2019 levels of inflows. But the outlook for the global economy is darkening, underpinned by structural factors in the economy.\u201d<\/p>\n

These include policy factors, trade tensions, and a return of protectionist tendencies.<\/p>\n

In addition, the strengthening of the digital economy and thus a shift toward intangibles in international production will play a role, alongside significant declines in FDI returns, already evident over the past five years.<\/p>\n","protected":false},"excerpt":{"rendered":"

Global foreign direct investment (FDI) fell by nearly a fifth in 2018, to an estimated $1.2 trillion from $1.47 trillion in 2017, according to the latest UNCTAD Global Investment Trends Monitor released on Monday, with Nigeria and Angola experiencing weak performance.<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[23,1593,17],"tags":[4842],"coauthors":[2391],"class_list":["post-30737","post","type-post","status-publish","format-standard","","category-business","category-metro","category-news","tag-fdi"],"yoast_head":"\nNigeria, Others Get $40b As Global FDI Falls To $1.2tr - National Wire<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/nationalwire.com.ng\/sub\/nigeria-others-get-40b-as-global-fdi-falls-to-1-2tr\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Nigeria, Others Get $40b As Global FDI Falls To $1.2tr - 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