Vol. 11 No. 1 (2025)
March

Articles

Impact of the COVID-19 pandemic on foreign direct investment worldwide

Published 2025-03-01

  • Wojciech Zysk

Wojciech Zysk
Krakow University of Economics

Abstract

Objective: The objective of this article is to identify and describe selected trends and phenomena occurring in the global economy in conjunction with the description of changes taking place globally, in the EU countries, in the Visegrad Group (V4) countries and in Poland, which are related to the impact of the COVID-19 pandemic on capital flows in the form of foreign direct investment.

Research Design & Methods: We used own calculations made based on available UNCTAD statistics provided in the WIR Reports 2010-2023 and the UNCTADstat database. We also used literature studies, source text analysis, logical inference method, deductive reasoning, documentary and critical analysis methods, descriptive analysis, comparative analysis, and simple quantitative methods such as time series analysis.

Findings: We verified eight main research questions, each with four specific research questions (32 analyses in total). In the vast majority of cases, the main questions were verified positively in full, meaning that we confirmed the assumption that foreign direct investment (FDI) outflows, the number of net cross-border M&As (by seller region), the value of announced greenfield FDI projects (by source of investment), the value of announced greenfield FDI projects (by destination of investment) and the number of announced greenfield FDI projects (by source of investment) decreased after the outbreak of the COVID-19 pandemic in all the proposed four geographic aspects. For main research questions RQ1, RQ3, and RQ8, i.e. FDI inflows, net cross-border M&As (by seller region) and the number of announced greenfield FDI projects (by destination of investment), we observed positive verification only partially. For specific research questions RQ1d, RQ3b, and RQ8d, the verification of assumptions was negative.

Implications & Recommendations: The presented research findings have not only a descriptive but also an explicative value. They may also have an implication value when we consider the level of investment attractiveness of our country and the possible location and relocation of foreign capital in our part of Europe related to the destabilisation of global value chains and the search for safe location havens for foreign direct investment. It is becoming important to look for attempts to reduce business dependence on production processes far abroad, for example outside the EU. Paradoxically, the effect of the COVID-19 pandemic may be the emergence of a development opportunity for Poland and the countries of our region.

Contribution & Value Added: Proposal to broaden the nomenclature of negative phenomena – my proposal of ‘new swan colours’ (a reference to N.N. Taleb’s ‘black swans’). A literature search was also conducted in relation to various types of crises (sudden events) – including the COVID-19 pandemic – and foreign direct investment. The conclusions from research findings (especially regarding Poland) can serve as recommendations for specific actions at the government level.

Keywords

COVID-19 pandemic, foreign direct investment, FDI, Visegrad countries, economic activity

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Author Biography

Wojciech Zysk

Associate Professor (Prof. UEK) of the Krakow University of Economics (Poland). Habilitated Doctor of Economics (DEcon), PhD in economics; specialist in foreign trade and FDI. His research interests include Fair Trade, SRI, CSR, international entrepreneurship, e-commerce, foreign trade, and European business. Author and co-author of several books and over 90 scientific articles.

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