RIYADH: Global foreign direct investment is set to fall again in 2025 thanks to high investor uncertainty prompted by trade tensions, according to a UN analysis.
In its latest report, the UN Conference on Trade and Development revealed that FDI dropped 11 percent to $1.5 trillion in 2024, marking a second year of decline.
While FDI flows were up 4 percent, this figure was inflated by volatile flows through conduit economies.
Ongoing trade tensions have lead to downward revisions of most indicators, including FDI prospects, capital formation, and exports of goods and services, as well as financial market volatility, and investor sentiment.
The views of UNCTAD align with a recent report released by the World Bank, which said that FDI flows into developing economies dropped to $435 billion in 2023, the lowest level since 2005, as rising trade barriers, geopolitical tensions, and growing fragmentation curbed cross-border investment.
