ADB says China remains top destination for global FDI in Asia

Global foreign direct investment (FDI) flows to the Asia-Pacific region continue to recover to pre-pandemic levels, with China remaining the top destination in Asia, according to a report released by the Asian Development Bank (ADB) on Tuesday.

The Asian Economic Integration Report 2023 says that FDI into the Asia-Pacific region expanded by 64.3 percent in 2021, nearly 7 percent higher than in 2019, accounting for 40 percent of global inward FDI in 2021.

China remains the top destination for global FDI in Asia.

Meanwhile, outward investment from Asia recovered by 15.2 percent in 2021.

"Having been robust in 2021, FDI flows may subside in 2022, given the uncertain global environment," the report said, adding that investment chapters in new mega-regional agreements, such as the Regional Comprehensive Economic Partnership, may complement efforts to promote investment.

According to the report, firm-level data also highlight Asia's resilience in attracting FDI. Greenfield investment in the region grew by a modest 0.8 percent in 2021 after declining 40.9 percent in 2020.

Besides manufacturing, greenfield investments grew mainly in business activities like electricity, information and communication technology, the report said.