International Investment in A Turbulent Era
Key findings
Global foreign direct investment showed resilience in 2025, but the recovery remained fragile Foreign direct investment (FDI) flows rose by 6 per cent, to $1.6 trillion. Inflows increased by 11 per cent in developed economies and by 2 per cent in developing economies. Excluding conduit flows through major European financial centres, global FDI increased 4 per cent after two consecutive years of decline. The outlook for 2026 is affected by significant downside risks owing to trade policy uncertainty, geopolitical tensions and conflicts.
Investment activity is increasingly concentrated in several capital- and technology-intensive sectors The growth in the value of FDI projects was driven largely by investment in data centres, followed by oil and gas and semiconductors. Most other sectors registered significant declines, including renewable energy, infrastructure (excluding data centres) and manufacturing.
Inflows rose significantly in least developed countries FDI in structurally weak and vulnerable economies was driven by least developed countries (+21 per cent) but remained highly concentrated in a small number of economies and largely confined to resource-rich countries. Flows to small island developing States remained limited, going mainly to tourism, renewable energy and logistics.
Investment in the Sustainable Development Goals picked up in 2025 but was unevenly distributed The value and number of announced projects in developing economies rose, particularly in least developed countries. The rebound remained concentrated in a few sectors and economies, underscoring persistent challenges in mobilizing investment for smaller projects and economies.
The global investor landscape has become more diverse Alongside traditional multinational enterprises (MNEs), State-owned MNEs and private equity investors are playing an increasingly important role in FDI. More than a quarter of the companies in the 2026 UNCTAD ranking of the top 100 MNEs are State-owned, and international equity acquisitions by private equity firms now account for about 20 per cent of global mergers and acquisitions.
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