Global foreign direct investment (FDI) plunged by 42 percent in 2020, a new report by the United Nations Conference on Trade and Development (UNCTAD) showed on Sunday, while China bucked the trend becoming the world's top recipient of investment flows.
In its latest Investment Trends Monitor, the Geneva-based UN trade and development body said that FDI fell sharply to an estimated 859 billion U.S. dollars last year, from 1.5 trillion U.S. dollars in 2019, and warned of further weakness this year, putting a sustainable recovery from the COVID-19 pandemic at risk.
"FDI finished 2020 more than 30 percent below the trough after the global financial crisis in 2009 and back at a level last seen in the 1990s," the report wrote.
The data showed that the decline was concentrated in developed countries, where FDI flows fell by 69 percent to an estimated 229 billion U.S. dollars, the lowest level in 25 years.
The decline in developing economies was relatively measured at 12 percent to an estimated 616 billion U.S. dollars, the report showed, while China topped the ranking of the largest FDI recipients.
FDI flows to China rose by 4 percent to 163 billion U.S. dollars, making the country the world's largest recipient in 2020, followed by the United States.
"A return to positive gross domestic product (GDP) growth and the government's targeted investment facilitation program helped stabilize investment after the early (coronavirus) lockdown," James Zhan, UNCTAD's director of investment and enterprise, said in a virtual press conference.
"The global dependence on the supply chains of multinational enterprises in China during the pandemic also sustained the FDI growth in China," he added.
China saw its GDP increase 2.3 percent year on year last year and is expected to be the only major economy to post growth in the pandemic-ravaged year, according to the National Bureau of Statistics (NBS).