The United Nations Conference on Trade and Development (UNCTAD) expected that the foreign direct investment in the world will decrease by 40% this year due to the pandemic of the emerging Coronavirus (COVID 19), as developing countries will suffer the most from the consequences of declining investment.
According to estimates, foreign direct investment will decline during the current year from one trillion dollars, for the first time since 2005, compared to 1.54 trillion dollars last year. Foreign direct investment is also expected to decline by 5 to 10 percent over the next year, to return to growth in 2022. The developing economies are expected to experience the largest decline in foreign direct investment due to their dependence on foreign funds for manufacturing and extracting raw materials.
The world's largest 5,000 multinationals, which account for most of the foreign direct investment, have cut their expected profits for the current year by nearly 40 percent. During the first quarter of this year, UNCTAD recorded a decline in cross-border acquisitions and mergers in the world by 50 percent annually.
Source (Al-Sharq Al-Awsat newspaper, Edited)
