ECLAC: Foreign Direct Investment To Decrease by Half in 2020

The Economic Commission for Latin America and the Caribbean (ECLAC) forecasted on Wednesday that foreign direct investment (FDI) in the region would decrease by 50 percent in 2020 as part of the devastating impact of the COVID-19 pandemic.

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The organization's latest report indicates that the region is set to have the steepest decline in the world. Also, the ECLAC notices that this decreasing trend has continued "nearly uninterrupted" since 2012.

“The FDI received by Latin America and the Caribbean has not catalyzed relevant changes in the region’s productive structure, largely because the policies to attract these flows have not been articulated with those focused on product development. FDI offers major opportunities to move towards a new sustainable economy,” the ECLAC's Executive Secretary Alicia Bárcenas explained.

According to the study, in the decade 2010-2019, Europe has become the largest investor in the region, followed by the U.S. Last year, the top five countries regarding foreign investment were  Brazil, Mexico, Colombia, Chile, and Peru (6%).

Moreover, renewable energy projects report most of the investments for the next five years, amid a global landscape where direct foreign investment is expected to fall 40 percent in 2020 and between 5 percent and 10 percent in 2021.