Never before has global FDI been as capital-intensive as it was last year, Jonathan Wildsmith, fDi Intelligence
An impressive 159 large foreign direct investment (FDI) projects worth at least $1bn were announced globally in 2022, fDi Markets’s cross-border investment data shows. This is a record-breaking number of mega projects, as they are known.
While they represent less than 1% of the 16,000 FDI projects announced worldwide in 2022, they make up for half of the $1tn in capital pledges announced by foreign investors last year, signalling a greater concentration of global FDI in the hands of a limited number of large multinational enterprises (MNEs) with deep pockets and cross-border operations.
The US was a major hotspot for mega investment projects last year. Data from fDi Markets shows that the country attracted approximately 14% of the mega projects last year — 22 deals valued at an estimated $88bn in capital investment. Factoring in fDi Markets’s figures for inter-state investment, the US’s overall number of mega projects grows to 39, and adds $74.5bn in capital investment.
A perceived outlier in the data appears as Egypt ranked as the world’s top destination for mega projects in terms of capital investment in 2022. The country attracted more than $96.8bn in such projects last year, which is close to three times that of its previous record ($34.9bn in 2016). Meanwhile, by number of FDI projects, it grew from an average of 3.5 mega projects per year between 2013 and 2021 to 19 mega investments in 2022, ranking Egypt second only to the US.
The renewable energy industry accounted for the largest share (35%) of mega projects in 2022 as the sector witnessed unprecedented year-over-year growth. Renewables also received huge capital pledges in green hydrogen and wind energy. Amid higher energy prices and supply constraints after Russia’s war in Ukraine, the number of mega investments in coal, oil and gas grew from four in 2021 to 21 in 2022.
Meanwhile, electronic components (including battery manufacturing); metals (including cathode material production); automotive original equipment manufacturing (including electric vehicle production); and semiconductors accounted for close to a third of announced mega projects.
