ISLAMABAD – Foreign Direct Investment (FDI) inflows into Pakistan declinedby 20 percent to $1.9 billion in 2019 against $2.4 billion in 2018,according to the United Nations Conference on Trade and Development(UNCTAD).
UNCTAD’s latest Investment Trends Monitor (ITM) report said that South Asiarecorded a 10 percent increase in FDI to $60 billion. The growth was drivenby India, with a 16 percent increase in inflows to an estimated $49billion. Inflows to Bangladesh and Pakistan declined by 6 percent and 20percent respectively, to $3.4 billion and $1.9 billion.
According to UNCTAD World Investment Report 2019 released in June 2019,Pakistan, the fourth-largest recipient of FDI in the sub-region, registereda 27 percent decrease in investment to $2.4 billion in 2018. This waslargely due to the completion of some projects related to the ChinaPakistan Economic Corridor, and a balance-of-payments challenge that mayhave delayed new inflows.——————————
China remained the single largest investor in the country, thanks mainly toconstruction and power generation projects related to the Corridor. Withother Corridor projects also nearing completion, Pakistan’s FDI inflowscould slow down further in 2019.
Global FDI remained flat in 2019, at $1.39 trillion, a 1 percent declinefrom a revised $1.41 trillion in 2018. This is against the backdrop ofweaker macroeconomic performance and policy uncertainty for investors,including trade tensions.
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The underlying FDI trend, which removes the volatility caused by one-offtransactions and intra-firm financial flows, was up 5 percent (in line withprojections in the World Investment Report 2019) – a marginal changerepresenting a continuation of the stagnation observed over the decade.
FDI flows to developed countries remained at a historically low level,decreasing by a further 6 percent to an estimated $643 billion. FDI to theEuropean Union (EU) fell by 15 percent to $305 billion, while flows to theUnited States remained stable at $251 billion.
