Wednesday, October 17, 2007

Worldwide economic growth boosts global foreign investment


Worldwide economic growth has seen foreign investments in other countries swell by more than a third in 2006 compared with 2005 - the largest since record levels were set in 2000, according to the latest investment trends report by the UN Conference on Trade and Development (Unctad) published in Geneva.

Global Foreign Direct Investment (FDI) was up 38 percent on 2005 to $1.3 trillion, showed the report released Tuesday. Healthy growth in FDI was seen across the board in developed, developing and the transition economies of southeast Europe and the former Soviet republics of the Commonwealth of Independent States (CIS). South America and South Africa were two exceptions.

Africa saw FDI double between 2004 and 2006 to a record $36 billion. Africa's share of global FDI, which is relatively small compared with parts of Asia and Latin America, had nonetheless fallen from 3.1 percent in 2005 to 2.7 percent in 2006. Most foreign investment was in oil, gas and mining.

The value of FDI worldwide reached $12 trillion, funding the activities of 78,000 transnational corporations owning some 780,000 foreign affiliates.
The US regained its position as the main host economy for FDI, slipping ahead of Britain once more.

The largest inflows to developing countries were to China, Hong Kong and Singapore.
Among transition economies the largest inflows were to the Russian Federation.
The US was the main source of FDI but almost half the world's outflows originated in European Union countries, led by France followed by Spain and Britain.