| Simon Evenett and Johannes Frit z3 June 2021 |
| In many countries, foreign direct investment, or FDI, outperforms aid, remittances, and portfolio investments as the largest source of external financing. FDI creates jobs, boosts productivity, and brings management expertise and technology. Since the Global Financial Crisis of 2009, however, annual inflows of FDI have been in decline. New greenfield investments into developing countries have been particularly hard hit, falling by 57 percent year-on-year in the fourth quarter of 2020. Developing countries in Asia have been more resilient but not entirely spared. Supported by the Hinrich Foundation, a new report delves into this critical issue of declining FDI and explores the policy options that can help reverse the trend. In this 27th Global Trade Alert report, entitled Advancing sustainable development with FDI: Why policy must be reset, renowned trade experts Simon Evenett and Johannes Fritz detail the developments that have contributed to FDI’s decline and show what can be done to reinvigorate FDI as an engine for sustainable development. |
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