Global Foreign Direct Investment Falls for the Second Consecutive Year

 Global foreign direct investment (FDI) fell by 11%, marking the second consecutive year of decline and confirming a deepening slowdown in productive capital flows, according to the World Investment Report 2025, released today by UN Trade and Development (UNCTAD) on 19 June. 

Although global FDI rose by 4% in 2024 to $1.5 trillion, the increase is the result of – among other factors – volatile financial conduit flows through several European economies, which often serve as transfer points for investments.

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 The report comes ahead of the 4th International Conference on Financing for Development (FfD4), where global leaders will address the widening gap between capital flows and development needs. 

The findings underscore the urgency of reshaping investment and finance systems to support inclusive and sustainable growth. In 2024, investment dropped sharply across developed economies, particularly in Europe. In developing countries, inflows appeared broadly stable – but this concealed a deeper crisis. In too many economies, capital is stagnating or bypassing entirely sectors that matter the most – infrastructure, energy, technology and industries that drive job creation. 

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“Too many economies are being left behind not for a lack of potential – but because the system still sends capital where it’s easiest, not where it’s needed,” said UN Trade and Development Secretary-General Rebeca Grynspan. 

The decline was largely driven by a 22% drop in FDI to developed economies, including a 58% plunge in Europe. North America bucked the trend with a 23% increase, led by the United States