C. Investment and capital flows

Foreign direct investment flows can, and should, be encouraged.

Other Governments are promoting investment flows within the framework of bilateral agreements.

An increase in FDI outflows is a priority in China for two reasons.

One is that Governments have been supporting FDI outflows.

Each of the developing regions experienced an increase in FDI inflows in 2004.

While foreign direct investment flows kept increasing, the trend could not be guaranteed.

Intra African investment flows are mainly from South Africa.

South South FDI flows have been motivated by push and pull factors, and similar structural, cyclical and policy factors similar to those between developed and developing countries.

Meanwhile, FDI flows bounced back in the United Kingdom and the United States.

Not all developing regions have participated equally in the emergence of international investment flows.

Flows to developing countries appear to lead the recovery in global FDI.

Investment flows have recovered, reaching the annual average for the years prior to the Asian crisis.

FDI by SMEs involved evaluation of investment locations based on a set of variables which could be clustered under markets, costs, natural resources, infrastructure framework, policy framework and business promotion and support factors.

Foreign direct investment flows have generally been influenced by policies that do not discriminate between foreign and domestic investors.

This poses a great challenge as to how to induce more investment inflows to developing countries. Various host and home country policy instruments have been used to address this problem.

When countries suffer from low investment demand, freeing up capital inflows does not do much good.

The Libyan Arab Jamahiriya will significantly increase its FDI inflows as a result of the end of sanctions in 2003.

Reflecting flawed economic arguments, India embraced autarky in trade and rejected inflows of equity investment.

Currently, the US receives only about 2 3 of FDI flows from China.

His Group requested UNCTAD to continue to review FDI trends and policy issues related to the impact on home and host countries of outward FDI from developing countries, particularly in the South South context.

He reaffirmed the commitment of his Government to reinforcing investors' confidence in the country. Several reforms had already been implemented and would be pursued. He stressed the importance of follow up in the implementation of the policy recommendations of the report

Trade and investment flows can and should be expanded, which is likely only if political relations improve.

Table 2. FDI outflows as a percentage of gross fixed capital formation in selected economies, 2001 2003a

Lack of institutional structure and lack of capacity are obstacles to intra African FDI and portfolio investment.

FDI inflows had become significant in Benin only after the establishment of a market oriented economy in the late 1980s.

More than 64 per cent of Singapore's OFDI was in Asia.

Over the past 15 years, FDI outflows from developing countries have grown faster than those from developed countries.

Regional integration in ASEAN had encouraged intra ASEAN investment, which contributes to South South FDI flows.

First, for the purpose of fostering an enabling global environment to facilitate international investment flows and increasing R D related FDI, UNCTAD could help define the scope of investment issues, including development aspects, so as to assist developing countries in negotiating provisions for free trade agreements.

Uribe has also proven to be a strong economic administrator, attracting increasing flows of foreign direct investment to Colombia.

FDI inflows into developed countries fell by an estimated 16 per cent to 321 billion in 2004.

From a very low base, FDI in Africa increased for the second consecutive year to 20 billion.

Since 1993, substantial OFDI from Singapore has helped increase the competitiveness of Singaporean firms and the Singapore economy.

Overall, FDI flows are expected to increase over the medium term because of improvements in the main fundamentals that drive FDI a broad based economic recovery, equity market valuations and mergers and acquisitions (M As) activity.

FDI flows in services between developing countries are growing faster than flows between developed and developing countries.

Despite the significant increase in recent years, FDI inflows remained concentrated in a few specific sectors sectors particularly oil, steel, chemicals and pharmaceuticals Moreover, they seemed not to have a significant impact on the national economy in terms of job creation, access to markets and technology transfer.

The other major advantage of such regional groupings has been their ability to attract foreign direct investment. Since the early 1990 s, Mercosur has managed to mobilize 5.9 of world FDI inflows.

The Government of Peru's economic stabilization and liberalization program lowered trade barriers, eliminated restrictions on capital flows, and opened the economy to foreign investment, with the result that Peru now has one of the most open investment regimes in the world.

Europe s leaders need to put private investment at the center of their growth strategy by devising policies that open the gates to large potential flows.

In particular, capital expenditure revived in many countries and foreign direct investment inflows into the region also increased sharply in 2004.

Third, as had already been mentioned, FDI flows were concentrated in regions that had the necessary infrastructure in place and dynamic manufacturing and industrial sectors.

While the strategy of taking advantage of FDI inflows had been successful in other developing countries, this had not been the case in Africa.

The EU emphasized the importance of studying further the policies and regional agreements that could foster South South investment flows.

Its asset coverage was estimated to be 1.4 billion a year and was expected to grow after a slow year of FDI flows to developing countries.