Brazil attracts 41% of direct investment in Latin America in 2022

Benefitting from the global economic recovery following the COVID-19 pandemic, Latin America and the Caribbean witnessed a surge in foreign direct investment (FDI) in 2022, reaching a record high, as announced by the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) on Monday (Jul. 10). Last year, the region attracted $224.58 billion in foreign investment for its productive sectors, representing a remarkable 55.2 percent increase compared to 2021.

In terms of distribution among countries, Brazil emerged as the top destination, capturing 41 percent of the total FDI inflow in the region. Mexico followed closely in second place, attracting 17 percent. Both countries stand as the largest economies in Latin America and the Caribbean. Brazil experienced nearly double the FDI growth from 2021 to 2022, with an impressive 97 percent increase, while Mexico saw a more moderate growth of 14 percent compared to the previous year.

Unlike financial investments that primarily target the financial market, foreign direct investments are aimed at generating employment opportunities, such as through the acquisition of domestic companies or the expansion of foreign enterprises into new countries. ECLAC highlights that the sectors that benefited the most last year were services, renewable and non-renewable energy, and manufacturing.

Low attraction

Last year, the global volume of FDI totaled $ 1.29 trillion, up 11 percent compared to 2021. Despite the growth, Latin America attracted only 8 percent of the global inflow of foreign direct investment in 2022. Proportionally, the region had the lowest share behind Europe, Asia-Pacific, Africa, the Middle East, and North America.