From N.A.R., International Real Estate Report, Wednesday November 14, 2007
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 the World Investment Prospects Survey 2007-2009, conducted by the United Nations Conference on Trade and Development (UNCTAD) . Survey results are based on respondents from the world's largest transnational corporations. More than two-thirds of the respondent companies plan to increase their FDI expenditures in each of the years 2007 through 2009. FDI is expected to increase across nearly all sectors due to continued world economic growth, high profitability, and the availability of finance. Greenfield investments (the new establishment of affiliates in foreign countries) will be more commonly used as an entry mode into developing economies, while investment in developed countries will more frequently be in the form of mergers and acquisitions. Access to large and growing markets was the key driver of FDI, as well as access to resources and skilled and/or low-cost labor. On the flip side, geopolitical and financial instability were mentioned as major uncertainties that could hinder their FDI expansion, as well as a possible increase in protectionism. China and India topped of the list of most attractive FDI destinations for 2007 - 2009, with the U.S. ranking third. Following, in order of rank, was Russia, Brazil, Vietnam, United Kingdom, Australia, Mexico and, tieing for 10th place, Poland and Germany.
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