UNCTAD (Unite Nations Conference on Trade and Development) has published, as it does every year, a report giving the foreign direct investment (FDI) flows throughout the world during the previous year. In 2002, these flows declined considerably compared to the year before, from $1,300 billion in 2000 to 760 billion last year, i.e. a fall of 40%. All developed countries are affected as well as, to a lesser extent, the developing countries except for Africa. The general economic slowdown and a reduction in merger and acquisition operations (6,000 transactions worth a total of $600 billion in 2001 compared to 7,900 in 2000 for an overall value of $1100 billion) are the main reasons for the fall in FDI flows, states UNCTAD. It stresses the stability of other determining factors such as the quality of infrastructures, the presence of qualified labour and the technological capacities of the host country. Furthermore, events on 11 September do not seem to affect the investment projects of transnational companies for the next three years, according to the results of an inquiry carried out among 129 such companies between May and November 2001 by AFII (Agence française pour les investissements internationaux), which will continue to give preference as a target for their investment to the United States for the developed countries and to China for the developing countries. The report specifies that: - Developed countries: the FDI flows in developed countries declined by nearly half in 2001, going from a record $1,000 billion in 2000 to 500 billion last year. The slowdown occurred in most of the developed countries but some were more affected than others. Thus, a great decline in flows was recorded in Austria ($1.8 billion over the first nine months of 2001, the most recent official figures, compared to 8.6 billion over the whole of 2000), Belgium/Luxembourg ($17.1 billion compared to 218 billion), Denmark (5.8 billion compared to 32.3 billion), Germany (20.8 billion compared to 176.1 billion), the United Kingdom (54.6 billion compared to 119.7 billion), and the United States (144.1 billion compared to 287.7 billion). The FDI by developed countries abroad also fell sharply last year. Belgium/Luxembourg were particularly reticent and only invested $19.5 billion over the first nine months of 2000 as opposed to 215 billion over the whole of 2000, France (68.8 billion compared to 172.5 billion), and the United Kingdom (35.6 billion compared to 255d billion), which nonetheless remains the largest European investor. The United States, for its part, remains the leading foreign investor with $134.1 billion invested between January and September 2001 compared to 152.4 billion in 2000. - Developing countries: FDI flows towards LDC fell slightly from 240 billion in 2000 to 225 billion in 2001. All regions were affected except for Africa. Taking region by region, the FDI towards Latin America and the Caribbean fell from 86 billion to 80 billion. A slowdown in investment by Spain, the largest investor, from 20 billion to 8 billion is the main reason for this fall in investment. While the flows towards Argentina and Brazil are plummeting, however, Mexico is coming out of it rather well with $25 billion received in 2001, that is twice the amount of the previous year. In the Asian developing countries, flows declined from $144 billion to 125 billion due to the large fall in Hong Kong. India and China, on the other hand, found investment flows increasing. With $46.8 billion FDI, China is expected to become the leading FDI-recipient developing country, a situation that should be confirmed with this country's entry into the WTO, offering new investment perspectives. In Africa, the flows, albeit high, increased from 9 billion in 2000 to 11 billion in 2001, with increased flows in Morocco and South Africa. They fell, however, in Egypt. In Central and Eastern Europe, they remain constant in 2001, becoming stable around $27 billion. For the first time since 1989, flows towards Poland decreased as the cycle of mega-privatisation deals slowed. Flows towards the Czech Republic, the Russian Federation and Hungary increased slightly. Despite the general fall of FDI last year, UNCTAD remains optimistic for 2002, foreseeing renewed confidence on the part of consumers, that should augur well for a recovery in the global economy and hence also investment.