Irish Economy
Global FDI dipped in 2012; Projects into Ireland down 21%
By Finfacts Team
Apr 19, 2013 - 7:27 AM

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The number of FDI (foreign direct investment) projects into and out of Europe declined in 2012, mirroring global trends. A total of 3,891 projects into Europe were recorded, representing a 20.82% decrease in comparison with 2011. In 2012, the top 10 countries accounted for 72.19% of FDI projects into Europe. FDI projects into Ireland (new to Ireland and new projects by existing foreign-owned firms in Ireland) amounted to 147 and represents a decline of 21%. Spain and Poland were the only top countries to experience a growth in FDI.

The data on what are termed 'greenfield' projects (include both new arrivals and expansions by existing companies and are ranked in numbers rather than value) come from fDi Intelligence, a unit of the Financial Times. The Irish data also includes projects other than those supported by IDA Ireland, the inward investment agency, such as retail projects eg Tesco, Aldi etc.

The fDi says there were 170 Irish sourced projects in 2012. However, this data includes foreign companies with Irish headquarters and other foreign-related transactions.

Overall, 2012 was a very difficult year for the global foreign direct investment market. But there were exceptions, with a number of countries experiencing strong growth in inward investment projects.

 fDi said Asia-Pacific remained the leading regional destination for FDI in 2012, with 3740 projects tracked, increasing its global market share to 31.72%. Of the top five destinations in Asia-Pacific, Australia was the only country to achieve growth in project numbers, with FDI rising by 4.24%. This increase follows a small decline in FDI in Australia in 2011.

In North America, most states and provinces experienced a decline in FDI, with Michigan the outstanding exception achieving a 60% growth in FDI projects. Alabama also achieved strong growth. The two states’  excellent performances reflect the rebound of the automotive sector in the US.

The latest edition of 'The fDi Report' has a special focus on the BRIC economies of Brazil, Russia, India and China.  fDi says that in recent years these countries have attracted more than 22% of global FDI projects, however, their share declined  in 2012 to 17.6%. FDI into China, India and Russia peaked in 2008 and has not recovered since. FDI into Brazil, after a record high in 2011, experienced a decline in 2012. The number of FDI projects in China and Russia in 2012 was the lowest in the past decade. With Brazil struggling to regain growth, Russia muddling along, and growth levels in China and India falling, we expect the market share of BRICs in global FDI to continue to decline in 2013.

Separate data this week showed that Europe was the most popular destination for Chinese FDI.

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