FDI in Latin America hits record high

Santiago, May 4 (IANS) Foreign direct investment (FDI) in Latin America reached a record high of $153.45 billion in 2011, representing 10 percent of the total global flows, the Economic Commission for Latin America and the Caribbean (ECLAC) said Thursday.

The figure was well above the previous record of $137.001 billion registered in 2008, the commission said.

In 2010, the region received $120.88 billion, while in 2009 the international economic crisis caused a drop in investment to $81.589 billion, according to the ECLAC.

Brazil was in the lead, receiving $66.66 billion, amounting to a whopping 43.8 percent of the total, the commission said in its 2011 report.

It was followed by Mexico with $19.44 billion, Chile $17.299 billion and Colombia $13.234 billion, reported Xinhua.

In Central America, FDI rose 36 percent compared with 2010, while in the Caribbean, it increased 20 percent compared on a yearly basis.

"Although there is still uncertainty in the global financial markets, the Latin American and Caribbean economies attracted important amounts of foreign direct investment in 2011, which will remain high during 2012," ECLAC executive secretary Alicia Barcena said while releasing the report.

The report said 46 percent of FDI net inflows in the region corresponded to re-investment of profit, reflecting that transnational companies have confidence in the region.

Nevertheless, the ECLAC warned of the growing trend of repatriation of profits by transnational corporations.

"FDI is not a unidirectional flow," Barcena noted, "FDI revenue transferred back to the countries of origin has increased from $20 billion per year between 1998 and 2003 to $84 billion between 2008 and 2010 per year."

The European Union (EU) as a bloc is the region's biggest investor, the ECLAC said, investing in the last decade an average of $30 billion a year, or 40 percent of the total.