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Foreign Investment Rises for First Time During Pandemic
OECD report shows that investment in foreign direct products (FDP) was on the rise in 2021. FDI flows reached $1.82trn in 2021, an 88% increase from 2020, which was severely affected by the onset of the Covid-19 pandemic. However, this bounceback also surpassed pre-pandemic levels, up by 37% on 2019 figures.
"It's great to be able to report this," says an agency spokesperson. "We'd feared how we were going to break this news when the numbers first started being scrutinized." According to new findings, non-distributed foreign-owned business earnings are one of the main reasons behind increases in net income among non-locally owned businesses which took place over the last 12 months (according to 2010 estimates).
What's more, more of said earnings were reoriented back into reinvestment programs compared with previous years, resulting in larger totals for international investment funds. On a separate note, OECD figures also revealed negative intra-company debt balances across all countries from 2016 onward—though admittedly, there is strong evidence that this trend may reverse as early as 2021.
Glenn Barkley, the chief economist at Investment Monitor, says that based on the 2018 figure and the way investment was ramped up during the prior year of 2019, where companies took advantage of Covid-19-related lockdowns--as firms reduced project levels by more than 20%--an 18% increase in greenfield FDI is expected for 2021.
It is said that the U.S., Germany, and the UK will continue to be the leading destinations for greenfield projects throughout 2016. As a matter of fact, many countries have shown dramatic escalations of inbound projects; however, Asia, North America and western Europe continue to be critical inbound and outbound regions as investors will continue to flow into properties across all geographies in order to increase their portfolio values as well as manage their liabilities with new interest income coming into their bank accounts on a daily basis!
According to the Organisation of Economic Co-operation and Development (OECD), the top ten countries in which foreign direct investment occurs are located in ten different regions worldwide. They are the United States, China, Canada, Brazil, India, South Africa, Russia, Switzerland, Mexico and Germany.