Research - JUNE 22, 2016

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Global foreign direct investment hits $1.76t in 2015

by Andrea Waitrovich

In 2015, global flows of foreign direct investment rose by about 38 percent, to $1.76 trillion, the highest level since the global economic and financial crisis, according to the U.N. Conference on Trade and Development’s “Word Investment Report: 2016.”

The rise in FDI was partially due to cross-border mergers and acquisitions, which totaled $721 billion in 2015 from $432 billion in 2014.Those acquisitions were due to large corporate reconfigurations by multinational enterprises, including shifting their headquarters, for strategic reasons and tax inversion purposes. FDI patterns were, therefore, affected by tax inversions, mainly in the United States and Europe.

Inward FDI flows to developed economies almost doubled to $962 billion. As a result, the share of developed economies in world FDI inflows leaped from 41 percent in 2014 to 55 percent in 2015. The United States was the single highest FDI target at $380 billion, an increase from its 2

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