Foreign direct investment (FDI) flows are expected to increase over the next three years despite concerns about global financial instability and protectionism in some countries, according to a UN survey released on Thursday.
The World Investment Prospects Survey 2007-2009, conducted by the UN Conference on Trade and Development (UNCTAD), said FDI is expected to grow across practically all sectors due to continued world economic growth, high profitability and the availability of external finance.
UNCTAD said it sent a questionnaire to 1,500 transnational companies earlier this year and received a total of 191 responses.
More than two-thirds of the respondent companies plan to increase their FDI expenditures in each of the years 2007 through 2009, UNCTAD said.
According to the survey, access to large and growing markets will be by far the main driver of FDI growth, followed by access to resources, especially skilled labor. Access to low-cost labor was also mentioned by many companies surveyed.
A rising number of companies will consider investing in locations away from their home regions. Emerging markets, notably in Asia and Europe, are expected to receive more attention than before, the survey said.
The survey added that South and East Asia would continue to be the most attractive destination for FDI, notably China and India. Vietnam is also considered as a rising star in the region.
Besides, Western Europe and North America will continue to attract the largest share of FDI flows, while West Asia, North Africa and the sub-Saharan Africa continue to feature lowest among companies' investment preferences.
Source: Xinhua
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