SANTIAGO – The flow of foreign direct investment to 16 Latin American and Caribbean countries during the first half of 2015 totaled $88.72 billion, a drop of 21 percent from the same period last year, the UN Economic Commission for Latin America and the Caribbean said.
Contributing factors include the effect of falling commodity prices on the energy and mining sectors, the slowdown in China and an economic contraction in the region, according to Santiago-based ECLAC.
The largest decline was in recession-plagued Brazil, where a significant part of FDI has traditionally targeted activities geared toward the domestic market.
Mexico, the region’s No. 2 destination for FDI, saw inflows slip 8 percent, though ECLAC said it remained confident that the Aztec nation would enjoy a net gain in foreign investment for 2015 as a whole.
Foreign direct investment in Chile tumbled 10 percent thanks to weakness in mining, a trend “that could continue over the year.”
Argentina experienced an 11.5 percent fall in FDI compared with the first half of 2014.
FDI flows also decreased in Bolivia, Colombia, Costa Rica, Ecuador, Guatemala, Nicaragua, Peru, the Dominican Republic and Uruguay, confirming “a worrisome outlook for the region,” ECLAC said.
Conversely, FDI increased in El Salvador, Honduras and Panama.