Global FDI dips amid Hong Kong divestment and Brexit uncertainties: UN

Global FDI dips amid Hong Kong divestment and Brexit uncertainties: UN

Global direct foreign investment (FDI) dipped slightly last year after being knocked back by a massive divestment in Hong Kong and Brexit uncertainties, the United Nations said on Monday.

Global FDI flows in 2019 were estimated at $1.39 trillion which was 1% lower than the revised $1.41 trillion in 2018, according to the U.N. Trade and Development Agency (UNCTAD) in a report.

The U.N. added that FDI could rise marginally in 2020 as trade tensions eased between China and the United States. However, geopolitical uncertainties and protectionist pressures can dampen expectations.

Investment flowing into the Chinese territory of Hong Kong, the Asian financial hub that has been affected by political unrest, nearly halved last year to $55 billion. Meanwhile, Britain’s uncertainty last year over Brexit outcomes resulted in a 6% decline in inward FDI flows to an estimated $61 billion last year according to the report.

FDI into the EU fell by 15% to $305 billion due to “strong volatility” experienced by several countries. Flows to the US remained stable at $251 billion. Meanwhile flows to developing countries were also stable at an estimated $694 billion with China leading with a flat $140 billion.