The United Nations Conference on Trade and Development recently released a report on global foreign direct investment flows, titled “Global Investment Trends Monitor.”
The report indicates that despite a 3% decline from 1H 2011, China surpassed the U.S. as the world’s largest recipient of FDI at $59.1 billion (US) through the first half of 2012.
This might come as a surprise, considering that FDI to China has decreased in 10 out of the past 11 months.
China’s fall in FDI reflects a global trend, as global FDI inflows declined by 8.4% in 1H 2012 from 1H 2011. The decrease was concentrated in the BRIC nations and especially the United States, where FDI plummeted from $136.6 billion (US) in the second half of 2011 to $57.4 billion (US) in 1H 2012.
The global decline in FDI can be blamed on the Eurozone debt crisis and concerns of slowing growth in major economies – a metric with which FDI has a chicken-and-egg relationship.
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