Global Investment Trends Monitor, No. 44

Global FDI momentum weakened in 2022 with downward pressure on projects after Q1. Decline expected for 2023


  • New investment project numbers, including greenfield announcements, international project finance (IPF) deals, and cross-border mergers and acquisitions (M&As), all shifted in reverse after Q1 2022.
  • IPF and M&As were especially affected by deteriorating financing conditions, rising interest rates and growing uncertainty in financial markets. Cross-border M&A sales were 6% lower and IPF values more than 30% lower in 2022.
  • Greenfield project announcements for 2022 as a whole still showed growth (+6%) due to the momentum in the first part of the year. Values increased more because of several megaprojects and an increase in average project size in the renewables sector.
  • The sectoral distribution of greenfield megaprojects announced in 2022 illustrates key trends in cross-border investment. Three of the 10 largest announcements concerned chip factories, in response to global shortages and supply chain restructuring trends. Six of the top 10 project announcements were in renewables.
  • While the higher number of greenfield megaprojects in renewables is encouraging, international project finance in the sector – the bulk of climate change mitigation investment in recent years – is suffering. IPF numbers in renewables declined by 5% and values by almost 40%. As a result, overall international investment in climate change mitigation and adaptation shrank by more than 9%.
  • Looking at SDG investment sectors beyond climate change mitigation and adaptation, the recovery after the 2020 slump remains fragile. In developing countries, the number of projects across all SDG sectors (including sustainable infrastructure, food security, water and sanitation (WASH), and health, among others) increased by just 3% while values shrank slightly. International investment in agriculture and agribusiness remained stagnant at low levels.
  • The outlook for global FDI in 2023 appears weak. Negative or slow growth in many economies, further deteriorating financing conditions, investor uncertainty in the face of multiple crises and, especially in developing countries, increasing debt-related risks will put significant downward pressure on FDI.

Full-year FDI data for 2022 will be included in the World Investment Report 2023, scheduled for publication in June.

Global Investment Trends Monitor, No. 44 - Global FDI momentum weakened in 2022 with downward pressure on projects after Q1. Decline expected for 2023  (UNCTAD/DIAE/IA/INF/2023/1)
17 Jan 2023