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Kazakhstan Gets the First Position in the Rating of Foreign Direct Investments

Last year the global volume of net foreign direct investments fell by 35%

Photo: geralt/pixabay.com

Despite the negative impact of the pandemic on the global economy, Kazakhstan showed the biggest growth of net foreign direct investments (FDI) out of 17 transit economies and 34 landlocked countries, Kazakhstan’s Ministry of Foreign Affairs stated.

While the total amount of FDI has fallen by one-third globally and reached its lowest point recorded in 2005, Kazakhstan reported 34.9% growth in FDI compared to the prior year, the UN Conference on Trade and Development report said.

According to the UNCTAD report, the volume of net FDI in the entire world fell by 35% last year and reached one trillion dollars, which is the lowest result in the last 16 years. At the same time, the COVID-19 pandemic has been the most powerful factor that affected this sector in transit economies. The FDI flows might be restored in 2022 though, the UNCTAD estimates.  

However, in Kazakhstan FDI rate has been growing, which puts the country in the first position among landlocked countries with transit economies. The growth is based on investments in the processing industry, transportation, telecommunications, finance, energy, mining sectors, etc., the agency reported.

Global-FDI-Inflows.jpg

The total amount of FDI in transit economies last year reached $24 billion; Kazakhstan accounts for $3.9 billion, which is the second result after Russia.

A similar rating covers landlocked countries. Combined, they account for $15.4 billion of FDI with Kazakhstan as a leader of the rating.

According to UNCTAD's report even during the pandemic when the entire world’s economy struggled with recession, Kazakhstan has remained attractive for foreign investors. The agency forecast that in 2021 the average world’s FDI flow growth rate will be about 10-15% and 5-20% in developing countries.

In developed economies of Europe, the FDI rates have fallen by 80%; in North America by 42%, and by 20% in other developed countries. In the U.S. the main reason for FDI decreasing is the diminishing of revenues that can be reinvested.

In Africa, the FDI rate has fallen by 16% to $40 billion, which is the lowest rate recorded in the last 15 years.

Earlier this year UNCTAD has issued another report on global investments that said the FDI global volume fell to $1 trillion in 2020 compared to $1.5 trillion in 2019 and reached the lowest rate recorded in the last 15 years.
 


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