FDI drops $56m in first half of 2021

The net inflow of foreign direct investment (FDI) in Bangladesh dropped by $56 million in the first half of the current calendar year.

According to the Bangladesh Bank's monthly economic trends, the net inflow of FDI stood at $1,131 million in the January-June period of the current year, which was $1,187 million in the same period in 2020.

This around 4.74% decline goes against the global trend of rising FDI during the period.

According to UNCTAD's Investment Trends Monitor published on 19 October, Global FDI flows in the first half of 2021 reached an estimated $852 billion, showing stronger than expected rebound momentum. 

The increase in the first two quarters recovered more than 70% of the Covid-19 pandemic induced loss in 2020, UNCTAD reported.  

The global inflow of FDI came down to $957 billion last year, a decline of 35% from the annual inflow of $1,481 billion in 2019.

The FDI in the Least Developed Countries (LDCs), including Bangladesh, declined by 9% in the first half of the year against a 30% jump in middle-income economies and a 117% increase in high-income economies.

Developed economies saw the biggest rise, with FDI reaching an estimated $424 billion in the first half (H1) of 2021, more than three times that of the exceptionally low level in 2020. 

FDI flows in developing economies also increased significantly totaling $427 billion in 2021 H1, with a growth acceleration in East and South-East Asia (+25%), a recovery to near pre-pandemic levels in Central and South America, and upticks in several other economies across Africa and West and Central Asia.

Of the total recovery increase in global FDI flows in the first half of 2021 of $373 billion, 75% was recorded in developed economies. 

High-Income countries more than doubled quarterly FDI inflows from rock bottom 2020 levels, middle-income economies saw a 30% increase, and low-income economies a further 9% decline.