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Free Malaysia Today
9 hours ago
- Business
- Free Malaysia Today
Global investment decline may worsen due to tariffs, warns UN trade agency
UNCTAD secretary-general Rebeca Grynspan said investment that has a real impact on jobs and infrastructure is going down. (EPA Images pic) GENEVA : Global foreign direct investment (FDI) fell for the second consecutive year in 2024, with fears this year could be even worse as trade tensions rock investor confidence, the UN agency for trade and development said in a report published today. FDI transactions, which do not include several European conduit economies, declined by 11%, indicating a significant reduction in actual productive investment activity, according to the UN Conference on Trade and Development (UNCTAD). Geopolitical tensions and trade fragmentation contributed to lower investment last year as they created uncertainty, which UNCTAD secretary-general Rebeca Grynspan described as a 'poison' for investor confidence. 'We are even more worried about the picture in 2025…we already feel that investment is halted…tariffs are affecting growth,' Grynspan told Reuters, with short-term risk management being prioritised over long-term investment. UNCTAD said its outlook for international investment in 2025 was negative due to trade tensions. Early data for the first quarter of 2025 shows record low deal and project activity. When several European conduit economies – which act as intermediary hubs where investments temporarily pass through before reaching their final destinations – are included, the data showed that FDI increased by 4% to US$1.5 trillion. However, UNCTAD noted that this figure masks the reality that much of this investment is merely passing through these jurisdictions and was not productive. 'We see a very worrying tendency…Investment that has a real impact on jobs and infrastructure is going down,' she said. Developed economies suffered a sharp drop in investment, with a 58% decrease in Europe. North America, however, observed a 23% increase in FDI, led by the US, while countries in Southeast Asia reached the second-highest level of FDI on record with a 10% rise, representing US$225 billion. Though capital inflows in developing countries were broadly stable, UNCTAD observed that capital was not being injected into crucial job-creating sectors such as infrastructure, energy and technology.
Wall Street Journal
a day ago
- Business
- Wall Street Journal
Foreign Investment Faces Third Year of Decline on Tariff Uncertainty, UN Warns
Overseas investment by businesses around the world is at risk of falling for a third straight year as rising tariffs and geopolitical tensions freeze big decisions about where to locate factories, the United Nations warned. In an annual report, the United Nations Conference on Trade and Development said Thursday that foreign direct investment fell 11% in 2024, having also declined sharply in 2023. It said the early signs for 2025 are 'negative,' as businesses face high levels of uncertainty about the duties and other obstacles they will face in moving goods across national borders.
Reuters
a day ago
- Business
- Reuters
Global investment decline may worsen due to tariffs, UN trade agency warns
GENEVA, June 19 (Reuters) - Global foreign direct investment fell for the second consecutive year in 2024, with fears this year could be even worse as trade tensions rock investor confidence, the United Nations agency for trade and development said in a report published on Thursday. Foreign Direct Investment transactions, which do not include several European conduit economies, declined by 11%, indicating a significant reduction in actual productive investment activity, according to UNCTAD. Geopolitical tensions and trade fragmentation contributed to lower investment last year as they created uncertainty, which UNCTAD Secretary-General Rebeca Grynspan described as a "poison" for investor confidence. "We are even more worried about the picture in already feel that investment is are affecting growth," Grynspan told Reuters, with short-term risk management being prioritised over long-term investment. UNCTAD said its outlook for international investment in 2025 was negative due to trade tensions. Early data for the first quarter of 2025 shows record low deal and project activity. When several European conduit economies - which act as intermediary hubs where investments temporarily pass through before reaching their final destinations - are included, the data showed that FDI increased by 4% to $1.5 trillion. However, UNCTAD noted that this figure masks the reality that much of this investment is merely passing through these jurisdictions and was not productive. "We see a very worrying that has a real impact on jobs and infrastructure is going down," she said. Developed economies suffered a sharp drop in investment, with a 58% decrease in Europe. North America, however, observed a 23% increase in FDI, led by the U.S., while countries in Southeast Asia reached the second-highest level of FDI on record with a 10% rise, representing $225 billion. Though capital inflows in developing countries were broadly stable, UNCTAD observed that capital was not being injected into crucial job-creating sectors such as infrastructure, energy and technology.
Free Malaysia Today
a day ago
- Business
- Free Malaysia Today
Financial institutions ready to support JS-SEZ investors, say industry leaders
FMT managing director Azeem Abu Bakar (left), head of FDI advisory in the CEO's office at UOB Chiok Sook Yin (second from left), Affin Hwang Investment Bank's head of research Loong Chee Wei (centre), and Deloitte Malaysia executive director Thean Szu Ping during a session at the Nikkei Forum Medini, Johor 2025, co-organised by Iskandar Investment Bhd in Iskandar Puteri, Johor, yesterday. ISKANDAR PUTERI : Financial institutions are prepared to provide end-to-end support for investors in the Johor-Singapore special economic zone (JS-SEZ), offering a full suite of services to facilitate foreign direct investment, say industry leaders. Chiok Sook Yin, head of foreign direct investment advisory in the CEO's office at United Overseas Bank Ltd, said the bank was well-positioned to 'connect the dots' for businesses entering Malaysia. 'Besides having strong network connectivity, we have financial supply chain management solutions that help investors expand local sourcing and support new suppliers that follow (prominent) companies into Malaysia. 'We're also helping lower the barrier to entry for investors and addressing their concerns before they enter the markets they've targeted,' she said during a session at the Nikkei Forum Medini, Johor 2025, co-organised by Iskandar Investment Bhd here today. Chiok was responding to a question from FMT managing director Azeem Abu Bakar, who moderated the session, on the role that financial institutions play in supporting expansion into the JS-SEZ. 'Johor is an up-and-coming hub where we're seeing a lot of cross-border opportunities and businesses. 'What's going to unlock this potential is the financial aspect, and to make things happen here, the money has to come in,' he said. JS-SEZ was formally established in January through an agreement between Malaysia and Singapore to boost economic connectivity between the state and the republic. It aims to attract 100 projects worth RM100 billion and create about 100,000 jobs in high-value sectors such as manufacturing, digital economy, logistics, clean energy, and tourism over the next decade. Chiok noted that JS-SEZ was attracting strong interest not only from Singaporean companies but from those in Europe and North Asia as well. Meanwhile, Affin Hwang Investment Bank's head of research, Loong Chee Wei, said the bank had evolved beyond financing to help connect stakeholders such as state authorities, manufacturers, and supply chain partners. 'We have strategic agreements to collaborate with key sectors and promote investment, including from Japan to Malaysia. 'We also advise our institutional investors and organise trips to Johor to explore opportunities,' he said. Deloitte Malaysia executive director Thean Szu Ping added that while financial institutions played a key role as facilitators, the government was also stepping up efforts to attract investment, especially in high-tech industries. 'For these industries, a special tax rate of 5% is available for up to 15 years. 'There are also additional incentives for capital-intensive industries, which will receive an investment tax allowance instead of a reduced tax rate,' she said.
Irish Times
2 days ago
- Business
- Irish Times
IDA Ireland to spend ‘very significantly more' than €100m on site for FDI
IDA Ireland will spend 'significantly more' than €100 million to develop the first of three planned 'next generation sites' around the State, according to Minister for Enterprise Peter Burke . It is understood to be targeting the computer chip sector. The agency, charged with sourcing foreign direct investment for the State, plans to 'develop up to three significantly larger scale, pre-permitted developments' in regional locations, it disclosed in a five-year programme published in February. Speaking in advance of Enterprise Ireland 's Food Innovation Summit in Croke Park, on Wednesday, the Minister said the cost of acquiring the sites would be 'very significant'. 'We will be, in the next couple of weeks, bringing a very significant proposal to Cabinet for our first large scale next generation site,' he said, adding that it would be a site in the west of Ireland, capable of attracting a 'significant company of scale'. READ MORE It would, Mr Burke said, be a 'very strong competitive offering' to foreign direct investment. Asked whether the sites were being earmarked for computer chip manufacturers, the Minister said: 'The KPMG report [into the outlook for Ireland's semiconductor sector] sets out an absolute opportunity here of getting an additional workforce of over 30,000 by 2040, which would be very significant for the sector. 'Right through Covid, we saw significant blockages in manufacturing. We saw blockages in the automotive sector brought to a standstill. Why? Because of a lack of chips. Chips are so important to the digital economy. 'Obviously, the geography of Ireland is very attuned to semiconductor activity, but also need utilities and you need a very significant capacities, and infrastructure,' he said. The Government is looking at 'putting together a war chest for two more additional sites' with pathways to be 'utilities rich' in tandem with the National Development Plan Review, the Minister said. 'The cost will be very significant' given the cost of achieving utility connections with 'the way the site is structured', he said, though he declined to go into specifics on cost of the first site. Asked if it would be more than €100 million, the Minister said: 'Oh, very significantly more than that.' 'We need strategic forward planning to enhance our offer to investors,' the IDA said. 'Ireland must fundamentally reposition its offering to develop a select number of significantly larger-scale solutions in order to be competitive in attracting the next generation of very large-scale, sustainable, capital-intensive FDI.' IDA chief executive Michael Lohan said the sites would be between 500 and 1,000 acres in size but had not yet been identified.
