The APEC region’s foreign direct investment continued to regain ground in 2011 and helped to lift global FDI inflows above their pre-financial crisis level, the Asia-Pacific Economic Cooperation said.
Despite lingering global economic uncertainty, FDI inflows to APEC economies increased 16 percent year-on-year to US$733 billion last year.
APEC economies’ relatively fast rate of investment recovery compared to other regions increased their share of global FDI inflows to 48 percent in 2011, from an average of 37 percent during the 2005-2007 run-up to the financial crisis.
It also brought the APEC region’s average FDI inflows for 2009-2011 to a level 13 percent higher than their average during the 2005-2007 pre-crisis period,
according to an APEC Policy Support Unit analysis of data from the newly launched United Nations Conference on Trade and Investment (UNCTAD) World Investment Report 2012.
“While investment opportunities in the APEC region are not immune to global economic realities as we have seen, they are proving to be resilient and provide an outlet for capital that has the potential to spur growth for businesses and markets worldwide,” said Ambassador Muhamad Noor, APEC Secretariat executive director.
The APEC region’s FDI growth came from different ends of the spectrum.
FDI inflows to developed APEC economies grew by 21 percent in 2011 versus 12 percent growth for developing APEC economies. The latter maintained a larger proportion of the region’s FDI inflows at 58 percent, however.
UNCTAD predicts global FDI inflows to rise by a mere 5 percent to $1.6 trillion in 2012 due to the global economic uncertainty and the possibility of lower FDI growth rates in emerging markets.
Global FDI inflows will rise by 11 percent to $1.8 trillion in 2013 and by 7 percent to $1.9 trillion in 2014, “barring any macroeconomic shocks,” it added.
“In light of the downside risks arising from the ongoing EU debt crisis, there is a concern that the uncertain business environment will cause many transnational corporations to scale back their operations and investments. APEC economies will therefore need to be extra vigilant and proactive to ensure their policies remain supportive of foreign investments,” the APEC said.
Photo: lyng883
