US EditionWorld Bank flags drop in FDI to developing countries
DEVELOPING ECONOMIES WORLDWIDE, JUN 16 – Foreign direct investment to developing economies dropped to $435 billion in 2023, the lowest since 2005, due to rising trade barriers, fewer treaties, and geopolitical tensions, World Bank reports.
- On June 16, 2025, the World Bank announced that investment from international businesses into emerging markets declined to $435 billion in 2023, marking the lowest amount recorded since 2005.
- This sharp decline followed increasing trade and investment barriers as many governments raised restrictions amid rising geopolitical tensions that made investors cautious.
- In 2023, foreign direct investment made up about 50% of the external financing flowing into developing countries, although the initiation of major projects declined and funding for sectors such as clean energy and healthcare decreased.
- Analysis of 74 developing economies from 1995 to 2019 shows a 10% FDI increase raises real GDP by 0.3% after three years, with greater impact in countries with strong institutions and trade openness.
- The World Bank urged governments to ease investment restrictions and strengthen cooperation to channel funds to countries with largest gaps, with a summit scheduled in Seville from June 30 to July 3, 2025.
24 Articles
24 Articles
Sub-Saharan Africa’s FDI flows drying up: Report
Sub-Saharan Africa received the lowest share of foreign direct investment inflows of all developing economy regions during 2012-23, new World Bank research showed. Globally, flows of FDI for developing economies fell to their lowest level since 2005 due to “rising trade and investment barriers,” the report found, reaching only $435 billion last year. Sub-Saharan Africa received around 5% of cumulative FDI flows in this period. The report’s autho…
Foreign Investment to Developing Nations Drops Sharply as Countries Raise Barriers
The World Bank says foreign investment in developing countries fell to its lowest level in almost 20 years in 2023. Money from businesses and investors abroad, known as foreign direct investment (FDI), dropped to $435 billion for these countries. Wealthier countries also saw a big fall, getting only $336 billion—the lowest since 1996. The United […]
Report shows slowdown in productive capital flows linked to geopolitical tensions and trade barriers; head of UN agency sees more “volatile, selective and uncertain” scenario; important sectors such as infrastructure, energy, technology and industry are stagnating in many economies. Source of original article: United Nations (news.un.org). Photo credit: UN. The content of […]
Scotland’s independence drive before 2014 did not reduce inward investment
stewartb With reference to the graph above, what happened to Scotland’s FDI performance pre-2015, in the years of uncertainty over what Scotland’s people would opt for in a late 2014 referendum. Would they choose that most awful of outcomes, independence? Surely that would have given foreign investors cause to pause – no longer in a UK, out of the EU – fears a plenty? So what happened? From Business Insider (May 27, 2015): ‘Survey: Slight fall i…
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