As Asia Pacific FDI specialists, we endorse the World Bank's call for an "investment boom" in developing economies but this isn't a magic solution. Development donors such as WB need to step in to enhance capacity development within emerging market investment promotion communities. This empowerment is crucial for fostering strategic and targeted FDI aligned with each country's strengths rather than generic approaches.
Global growth is set to slow further this year amid tight monetary policy, restrictive financial conditions, and feeble global trade and investment. Downside risks include an escalation of the recent conflict in the Middle East, financial stress, persistent inflation, trade fragmentation, and climate-related disasters. Global cooperation is needed to provide debt relief, facilitate trade integration, tackle climate change, and alleviate food insecurity. Among emerging market and developing economies (EMDEs), commodity exporters continue to grapple with fiscal policy procyclicality and volatility. Across all EMDEs, proper macroeconomic and structural policies, and well-functioning institutions, are critical to help boost investment and long-term prospects.
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