MONET 2030: Direct investments in developing countries

SDG 17: Strengthen the means of implementation and revitalize the global partnership for sustainable development

Goal description

«A successful sustainable development agenda requires partnerships between governments, the private sector and civil society. These inclusive partnerships built upon principles and values, a shared vision, and shared goals that place people and the planet at the centre, are needed at the global, regional, national and local level. […] Long-term investments, including foreign direct investment, are needed in critical sectors, especially in developing countries. These include sustainable energy, infrastructure and transport, as well as information and communications technologies. […]»

Swiss target 17.3: The Confederation strengthens the catalyst effect of official development cooperation funds to mobilise further resources for development

Significance of the indicator
The indicator shows Switzerland's direct foreign investment (capital flows) in developing countries as well as their distribution by income category. Direct investments help to integrate new markets; they can also help create jobs and transfer technology and management know-how in the target countries. In the interests of sustainable development, efforts should be made to increase direct investments in developing countries.

Help for interpretation
This indicator does not address the social and ecological impact at home and abroad of the opening up of a country's market.

International comparability
The indicator can be compared with OECD and Eurostat indicators.

Synthesis

Comments: Synthesis of the observed trends of the middle-income developing countries (MIC) and the least developed countries (LDC). The assessment of each variable is expressed by a value without dimension (-1 for a negative assessment, 0 for an unchanged assessment, +1 for a positive assessment). These values are then added up and the result sets the general trend of the indicator.

The indicator shows the development of Swiss foreign direct investments and their distribution by the countries’ income categories. Negative values refer to a reflux of capital to Switzerland (disinvestment).

The direct investment statistics 2014 contain for the first time findings from the revised surveys on financial relations with foreign countries. At the same time the changeover took place to the OECD's new international statistics standards on direct investments statistics (Benchmark Definition of Foreign Direct Investment, 4th edition) and to the IMF's Balance of Payments and International Investment Position Manual, 6th edition. With regard to direct investments abroad, only the capital stock in countries with subsidiaries managed directly from Switzerland must now be declared. With the previous system, if a chain of investment existed across several countries, the capital stock had to be shown for each of the countries where a subsidiary was located. The total of all countries results in lower capital investment stocks. The reason could be different ways of interpreting directly and indirectly run subsidiaries in the financial reports of individual companies. These methodological changes mainly affect the capital stocks and staff numbers associated with direct investment abroad. Capital transactions and investment income have not been significantly affected.

Swiss foreign direct investments (Switzerland’s capital exports) are ascertained annually by the Swiss National Bank. The countries’ income categories have been taken from the OECD’s Development Assistance Committee (DAC), which divides countries into categories based on per capita gross national income.

OECD – Development Co-operation Directorate

OECD – FDI flows by industry

SNB – Direct investments

Swiss target 17.3: The Confederation strengthens the catalyst effect of official development cooperation means to mobilise further resources for development.

International target 17.3: Mobilize additional financial resources for developing countries from multiple sources