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1. The setting of policy research and deliberation UNCTAD has contributed during the last three decades to research and policy analysis on foreign direct investment (FDI), activities of multinational enterprises [...]

The future patterns of foreign direct investment (FDI) are important inputs for policymakers, even more so during severe economic downturns, such as the one caused by the COVID-19 pandemic. Yet, there is neither empirical consensus nor significant ongoing empirical research on the most appropriate tool for forecasting FDI inflows. This paper aims to fill this gap by proposing an approach to forecasting global FDI inflows based on panel econometric techniques--namely the generalized method of moments--accounting for the heterogeneous nature of FDI across countries and for FDI dependence across time. The empirical comparison with alternative time-series methods confirms the greater predictive power of the proposed approach. Keywords: FDI, forecast, panel econometrics, time-series econometrics, underlying FDI trend, generalized method of moments JEL Codes: C23, F23, F47, 1. Introduction Foreign direct investment (FDI) is an important contributor to economic growth. The FDI-growth linkage operates through direct and indirect channels. Directly, multinational enterprises (MNEs) expand host countries' production [...]

The global economy is in the midst of a severe crisis caused by the COVID-19 pandemic. The immediate impact on international production is dramatic. Projections in the World Investment Report [...]

The UNCTAD-Eora Global Value Chain (GVC) database offers global coverage (189 countries and a 'Rest of World' region) and a timeseries from 1990 to 2018, reporting on key GVC indicators. This paper explains the methodology for compiling the UNCTAD-Eora GVC database, including nowcasting employed in the estimation of recent years; second, it provides a comparison of the results against other value-added trade databases, with a focus on the OECD Trade in Value Added (TiVA) dataset; and lastly discusses the relevance of GVC data for the analysis of globalisation patterns, particularly at the intersection between trade, investment and development. Keywords: trade in value added; MRIO; global value chains; complex value chains; value added in export; input-output analysis, 1. Introduction A pivotal element in the analysis of international production are global value chains (GVCs), which are fragmented and geographically dispersed production processes where different stages are located across [...]

Tax revenues from multinational enterprises (MNEs) are an important source of public finance in developing economies. The research and policy debate so far have mostly focused on the 'missing' part, i.e. the government revenues lost due to the tax avoidance practices of MNEs (Bolwijn et al., 2018). In this study, we take a different, but complementary, approach, looking at the taxes and other revenues actually paid by foreig n affiliates of MNEs to developing-country governments. We present two alternative methodologies to estimate foreign affiliates' fiscal contribution--the contribution method and the foreign direct investment (FDI) income method--and show that they lead to the same order of magnitude. The findings allow us to set a baseline for an informed discussion on tax avoidance by MNEs. Keywords: multinational enterprise, fiscal contribution, BEPS, domestic revenues, developing countries, 1. Introduction: objective and scope of the analysis The main goal of this study is to arrive at a meaningful order of magnitude for the fiscal contribution of foreign affiliates [...]

This paper explores the link between foreign direct investment (FDI) and the BEPS (base erosion and profit shifting) practices of multinationals (MNEs). It puts the spotlight on the outsize role of offshore investment hubs as major players in global corporate investment, a role that is largely due to MNEs' tax planning, although other factors contribute. The paper shows that tax avoidance practices enabled by FDI through offshore hubs are responsible for significant leakage of development financing resources. In policy terms, these findings call for enhanced cooperation and synergies between international tax and investment policymaking.Keywords: multinational enterprise, BEPS, revenue losses, developing countries, offshore investment, 1. Introduction: an investment perspective on international taxationMNEs build their corporate structures through cross-border investment. They construct those corporate structures in the most tax-efficient manner possible, within the constraints of [...]