GENEVA, June 6 (Xinhua) -- Global Foreign direct investment (FDI) flows fell by 23 percent in 2017 to 1.43 trillion U.S. dollars, in contrast to the global accelerated growth in gross domestic product (GDP) and trade registered last year, said the United Nations Conference on Trade and Development (UNCTAD) on Wednesday in its World Investment Report 2018.
The report said that FDI flows to developing economies remained stable at 671 billion U.S. dollars in 2017, seeing no recovery following a 10 percent drop in 2016, while inward FDI flows to developed economies fell sharply, by 37 percent.
"Downward pressure on FDI and the slowdown in global value chains are a major concern for policymakers worldwide, and especially in developing countries," UNCTAD Secretary-General Mukhisa Kituyi said. "Investment in productive assets will be needed to achieve sustainable development in the poorest countries."
The annual report said that global FDI flows are forecast to increase only marginally in 2018, by up to 10 percent, but remain well below the average over the past ten years.
The UN organization warned that escalating and broadening trade tensions could negatively affect investment in global value chains, while the U.S. tax reforms are likely to significantly affect global investment patterns.
The Developing Asia regained its position as the world largest recipient of FDI in 2017, as its share in global inflows rose from 25 percent in 2016 to 33 percent in 2017. China became the second largest recipient of FDI, with record inflows of 136 billion dollars.
Strong investment in the high-tech sector in China and increases in most countries belonging to the Association of Southeast Asian Nations (ASEAN) were enough to offset declines in other large recipient economies in the region, the report explained.
FDI inflows in the region are expected to remain at a similar level in 2018. "Inflows to China could see continued growth, as a result of recently announced plans to facilitate and attract foreign investment," said the report.