UNCTAD World Investment Report 2011:The development of foreign direct investment

In addition to international exports, cross-border investment by multinational enterprises (MNEs) is the second pillar of global economic integration. While exports in the last 40 years, before the recent financial market crisis, showed an annual average increase of between 10% and 11%, foreign direct investment (FDI) in the same period developed significantly stronger (average annual growth of between 12% and 17%). The development of foreign direct investment has been observed and analysed by UNCTAD (United Nations Conference on Trade and Development) for more than 30 years. Current global developments are published annually in the World Investment Report (WIR) and presented also presented at the Ifo Institute in Munich. The current trends in the 2011 Report are summarized and explained in this article. Special attention is devoted to the changed role of emerging and developing countries as destinations and sources of FDI. Furthermore, the role of alternative forms of production without capital participation (non-equity modes of international production – NEMs) is explained.