Foreign direct investments (FDI) are projected to plunge by 40% in 2020 due to the recession caused by the Covid-19 pandemic.
Developing and emerging economies are expected to be the worst affected with export-oriented and commodity linked investments projected to be severely impacted.
The decline in FDIs may transform international production and increase sustainability.
Olga Solleder, an economist, tweeted forecast made by the United Nations Conference on Trade and Development (UNCTAD) on the decline in FDI by 40% in 2020.
The projections are based on UNCTAD’s new report World Investment Report 2020.
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The new report notes that FDI will decline below $1tn for the first time since 2005.
FDI is expected further decline by 5%-10% in 2021, the report adds.