Addis Ababa, June 14, 2019 (FBC) – Ethiopia was among the five African countries that attracted more Foreign Direct Investment (FDI) in 2018, said the United Nations Conference on Trade and Development UNCTD.
According to the report released by UNCTD, Ethiopia attracted $3.3 billion FDI in 2018. However, the amount of FDI declined by 17% compared to the $4.1 billion it received in 2017.
Egypt was the leading African nation by attracting $6.8 billion FDI, followed by South Africa $6.3 billion and Congo $4.3 billion. Morocco and Ethiopia attracted $3.6 billion and $3.3 billion, respectively.
The report indicated that FDI flows to Africa rose by 11 per cent to $46 billion, despite declines in many of the larger recipient countries.
The increase was supported by continued resource seeking inflows, some diversified investments and a recovery in South Africa after several years of low-level inflows.
The report stated that global foreign direct investment flows continued their slide in 2018, falling by 13 per cent to $1.3 trillion.
The decline – the third consecutive year’s fall in FDI – was mainly due to large-scale repatriations of accumulated foreign earnings by United States multinational enterprises (MNEs) in the first two quarters of 2018, following tax reforms introduced in that country at the end of 2017.
FDI flows to developed economies reached the lowest point since 2004, declining by 27 per cent.
Inflows to Europe halved to less than $200 billion, due to negative inflows in a few large host countries as a result of funds repatriations and to a sizeable drop in the United Kingdom.
Inflows in the United States also declined, by 9 per cent to $252 billion. Flows to developing countries remained stable, rising by 2 per cent.
As a result of the increase and the anomalous fall in FDI in developed countries, the share of developing countries in global FDI increased to 54 per cent, a record, the report noted.