Lecturers and students from Vi core member, Pontificia Universidad Católica del Perú (PUCP), joined UNCTAD’s Noelia Garcia Nebra for a vi videoconference presentation of the 2015 World Investment Report (WIR) November 6. The event also counted with the participation of Gerald Pajuelo Ponce, Counsellor at Peru's Permanent Mission to the UN in Geneva.
The 2015 WIR reports a 16 percent drop in global foreign direct investment (FDI) in 2014 due to sluggish GDP growth, political uncertainties for investors and elevated geopolitical risks.
For 2015 and beyond, UNCTAD’s FDI forecast model projects global FDI inflows to increase from USD 14 billion in 2014 to USD 17 billion in 2017.
Although a survey of large multinational top executives supports these figures, “we need to remain cautious, as risks looming over the global economy may darken the outlook for FDI,” Garcia Nebra told the 19 participants from PUCP.
Flows into Latin America and the Caribbean – excluding the Caribbean offshore financial centers – decreased by 14 percent to USD 159 billion in 2014, after four years of consecutive increases.
In Peru, FDI flows dropped from around USD 9 billion in 2013 to USD 7.6 billion in 2014, amid a general decline in investments in the extractive industry.
"Nevertheless, Peru has moved up in the ranking and is now in the top five FDI destinations in Latin America, behind Brazil, Chile, Mexico and Colombia. South-South investment in the region is a factor of growing importance as well,” she said, citing the recent acquisition of the Las Bambas copper mine by China’s Minmetals Corporation.
Investment in the region is also key for the region in the context of the post-2015 development agenda, she added. “Policymakers may want to consider how the private sector could support the region's development path, as official aid to development is being hurt by budgetary cuts.”
In terms of investment policy, the 2015 WIR urges greater coherence between international tax and investment regulations.
“Countries need to take action against tax avoidance to support mobilization of domestic resources and, at the same time, continue to facilitate productive investment for sustainable development”, Garcia Nebra concluded.