Kathmandu. United Nations Secretary-General Antonio Guterres has said globalization of investment has retreated after a further drop in foreign direct investment last year.
The Un Trade and Development Agency (UNCTAD) has said that foreign direct investment (FDI) for 2025 is negative due to uncertainty caused by the tax war initiated by US President Donald Trump.
In its 2025 World Investment Report, UNCTAD said fdi fell 11 per cent to $1.5 trillion last year due to economic vigilance to overcome volatile financial flows through many European economies.
“At a time when the world needs to deepen cooperation and expand opportunities, we see the opposite happening,” Guterres said. “Obstacles are growing. Globalization has retreated and the consequences for sustainable development have become grim. “Rising trade tensions, policy uncertainty and geopolitical divisions threaten to worsen the investment climate,” he said.
Presenting the annual report at a news conference, UNCTAD chief Rebecca Greenspan said it sends a clear and urgent message that foreign direct investment (FDI) is weak. In 2024, international tensions, trade fragmentation and intense industrial policy competition shaped the investment landscape, unctad said.
“These factors are ‘undermining long-term investor confidence’,” UNCTAD said. Greenspan said trade showed good signs of recovery last year for the first time since the COVID-19 pandemic, but the current uncertainty has eliminated that possibility for 2025.
“The problem with us is that we don’t imagine the immediate possibility of an end to the trade war that Trump started in April,” he said. Foreign direct investment (FDI) in developed economies declined by 22 per cent, while europe fell 58 per cent, according to UNCTAD.
Under the leadership of the United States, North America has reduced this trend with an increase of 23 percent. In developing countries, flows have been largely stable.
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