ABSTRACT
This chapter looks at recent trends for foreign direct investment (FDI) in the services sector in general, factors that contribute to attracting FDI, the impact of such FDI on domestic economies, and the implications for both the business and policymaking communities. The coronavirus pandemic truly caused a disruption in the global economy to the point that FDI flows across borders dropped dramatically. Shifting the focus toward FDI inflows for types of economies varies among groups of economies—developed, economies in transition, and developing. However, the earlier trends for FDI inflows in services for developed economies have shown opposite results overall for these same economies over a four-year period from 2014 to 2018. The global health pandemic of 2020 has had a negative impact on the FDI to the emerging and developing economies. FDI in the services sector has shown positive gains in some countries and regions while exhibiting mixed results in others.
