Geography Reference
In-Depth Information
BOX 1.2
SOME FACTS AND FIGURES:
GLOBALIZATION OR TRIADIZATION OF
THE WORLD'S ECONOMIC ACTIVITY?
As we will see also in later chapters, inward FDI flows into devel-
oping and transition economies combined were, until recently,
less than half the level of all inward FDI into developed econo-
mies. In 2005 and 2006, the rate of growth of FDI inflows to devel-
oped economies, at 34 per cent and 45 per cent respectively,
was actually more than twice that of FDI inflows (21 per cent) into
developing economies (UNCTAD 2006, 2007). As such, the total
value of inward FDI into developing and transition economies
reached $379bn in 2006 (UNCTAD 2007), thereby accounting for
29 per cent of global FDI inflows (UNCTAD 2006), with 5-6 per
cent being accounted for by transition economies.
The most important macro-region for FDI inflows in recent years
is South, East and South-East Asia, which accounts for 53 per
cent of total FDI inflows into developing or transition economies.
In terms of individual countries, the largest FDI recipient amongst
developing countries is China, with $69.5bn, and amongst tran-
sitions economies is Russia, with $28.7bn (UNCTAD 2007).
Although the scale of FDI inflows to India in 2006, at $17bn,
is much smaller than that of China, this was equivalent to the
total inward FDI in India during the three previous years com-
bined, suggesting a rapid increase in India's attractiveness for
foreign investors (UNCTAD 2007). In comparison, Latin America
accounts for 6.4 per cent of FDI inflows, while the whole of Africa
receives just 2.7 per cent of global FDI inflows (UNCTAD 2007).
The relative dominance of the developed economies in FDI
also emerges when we consider FDI outflows. FDI outflows from
Western developed economies plus Japan grew by 45 per cent
between 2005 and 2006, accounting for 84 per cent of global
outward FDI (UNCTAD 2007). If Taiwan, Korea, Singapore and
Hong Kong are also included, the share of global outward FDI
increases to 89.6 per cent (UNCTAD 2007). Comparing these
shares with those reported below (see Box 1.3), we see that the
geographical origins of global FDI outflows very closely reflect
the geographical origins of R&D. In terms of the sources of these
FDI outflows, the US, Canada, Japan, Australia and Hong Kong,
plus ten European economies have been the top 15 sources of
