Singapore, Major FDI Source in Asia after HK and China, says UNCTAD

The United Nations Conference on Trade and Development (UNCTAD) reported that direct investments surged in Asia despite the global decline of its major recipients, China, Hong Kong and Singapore. According to the latest report of UNCTAD’s Investment Trends Monitor, the estimated foreign direct investment (FDI) of China was  US$144 billion, US$85 billion went to Hong Kong and US$58 billion proceeded to Singapore. With these numbers, China regarded to be the second largest recipients of FDI inflow, followed by Hong Kong in the third place and Singapore ranked eighth while the United States on the highest rank.

Comparative numbers for respective economies were not included in the quarterly report, however, as shown in the figures from last year’s report of the Investment Trends Monitor, FDI poured in Singapore with an increase of US$58 billion in 2017 versus US$50 billion in 2016. On the other hand, latest Asean report for FDI indicates an expansion amounted to  US$130 billion last year, and 45 percent of the total inflow went to Singapore. Nevertheless, years before the surge of FDI directed to Singapore last year came out lower compared in 2015 (US$65 billion) and 2014 (US$68 billion).  The global flows of FDI fell down to 16 percent to US$1.52 trillion in 2017, versus the predicted  US$1.81 trillion in 2016.

The downswing in FDI records to developed countries regarded to be the major reason for the global recessions.  In 2017, North America and Europe demonstrated a sharp decline in FDI inflows due to the reversal of inflow levels in the United States and the United Kingdom followed by spikes in 2016. The weakening eased off due to growth in FDI from developed economies, particularly from Australia’s expansion of 11 percent.

Generally, UNCTAD projected that the global economy will improve and trade will strengthen to boost FDI inflows around US$1.8 trillion this year.