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Global foreign direct investment (FDI) increased sharply in the first half of 2026, but a continued decline in new investment projects points to a fragile outlook amid geopolitical tensions, rising energy costs and supply chain disruptions, according to a new UNCTAD report.

UNCTAD’s latest Global Investment Trends Monitor found that FDI rose 37% compared with the average half-year level in 2025, driven largely by developed economies. However, the increase was concentrated in a small number of large transactions rather than a broad-based recovery in investment activity.

The value of cross-border mergers and acquisitions climbed 57% to $494 billion during the first nine months of 2026, even as the number of deals fell 23%.

Investment activity weakened across other categories. Greenfield investment announcements, which measure new projects, declined 15%, while international project finance deals dropped 11%.

FDI flows to developed economies surged by more than 70%, boosted by financial flows through the Benelux countries and a near-doubling of investment into the United States. Artificial intelligence-related industries accounted for more than 40% of announced greenfield investment value in the US.

Developing economies recorded an 8% increase in FDI flows, but new project announcements fell by more than 20%. Investment projects linked to the Sustainable Development Goals declined by over a quarter, while renewable energy project finance activity dropped by about one-third.

UNCTAD also highlighted growing disparities in digital investment. The value of announced greenfield investment in data centres in developing economies fell by $32 billion, suggesting digital infrastructure investment is becoming increasingly concentrated in high-income countries.

The report said the conflict in the Middle East is adding to uncertainty and costs. Greenfield project announcements in West Asia fell 52%, while global tourism projects dropped 28% and transportation and storage projects declined 22% in the first half of 2026 compared with a year earlier.

The findings come ahead of the World Investment Forum 2026 in Doha, Qatar, where policymakers and business leaders will discuss investment strategies under the theme “Investing in the Future.”