In 2025, global flows of foreign direct investment (FDI) increased by 14% and reached $1.6 trillion. This is evidenced by a preliminary report from the United Nations Conference on Trade and Development (UNCTAD).
According to information from the UN News Service, the recovery in flows occurred after two years of decline; however, the authors of the document warn that behind the positive indicators lies an unstable situation.
The main part of the growth is associated with transactions through international financial centers. Of the total increase, more than $140 billion came from so-called "transit flows." Without these, the real growth of FDI would have been only about 5%, indicating a weak recovery in underlying investment activity.
Nevertheless, key indicators of investor sentiment remain low.
Funding for international projects fell by 16% in value and by 12% in the number of deals, marking the fourth consecutive year of decline, reaching levels seen in 2019. The number of new greenfield projects decreased by 16%, and high aggregate figures were provided by only a few large projects.
At the same time, investments in developed economies increased by 43% to $728 billion.
The most significant contributions came from Europe and financial hubs. In the European Union, growth was 56% due to large cross-border deals and increased activity in economies such as Germany, France, and Italy.
Meanwhile, in developing countries, investment volumes decreased by 2% to $877 billion. Particularly severe consequences are felt in the least developed countries: in three-quarters of them, the inflow of FDI either stagnated or declined.
International infrastructure projects also decreased by 10%. The main reason was a sharp decline in investments in renewable energy, caused by a reassessment of return risks and uncertainty in regulation. Domestic investors have started to play an increasingly significant role; however, this may exacerbate the gap in countries that are heavily dependent on external financing for large projects.
UNCTAD experts emphasize that it is difficult to predict how events will unfold in 2026. If financial conditions ease and cross-border deals revive, FDI flows may increase slightly. However, real investment activity, according to the report's authors, will be limited by geopolitical tensions, political uncertainty, and the fragmentation of the global economy. Without coordinated measures, global investments may concentrate only in a few regions and sectors.
