Foreign Direct Investment in Latin America and the Caribbean 2017
This publication sets out and analyses the main foreign direct investment (FDI) trends in the countries of Latin America and the Caribbean. The 2017 edition shows that the region is at a difficult juncture. FDI inflows declined by 7.9% in 2016, to US$ 167.043 billion, representing a cumulative fall of 17.0% since the peak in 2011. The fall in commodity prices continues to affect investments in natural resources, sluggish economic growth in several countries has slowed the flow of market-seeking capital, and the global backdrop of technological sophistication and expansion of the digital economy has concentrated transnational investments in developed economies.
This publication sets out and analyses the main foreign direct investment (FDI) trends in the countries of Latin America and the Caribbean. The 2017 edition shows that the region is at a difficult juncture. FDI inflows declined by 7.9% in 2016, to US$ 167.043 billion, representing a cumulative fall of 17.0% since the peak in 2011. The fall in commodity prices continues to affect investments in natural resources, sluggish economic growth in several countries has slowed the flow of market-seeking capital, and the global backdrop of technological sophistication and expansion of the digital economy has concentrated transnational investments in developed economies.
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<strong>Foreign</strong> <strong>Direct</strong> <strong>Investment</strong> <strong>in</strong> Lat<strong>in</strong> <strong>America</strong> <strong>and</strong> <strong>the</strong> <strong>Caribbean</strong> • <strong>2017</strong><br />
Chapter II<br />
133<br />
Figure II.23<br />
Selected countries: national subsidies to purchase an electric vehicle, by type, 2016<br />
(Dollars per vehicle)<br />
Norway<br />
Rep. of Korea<br />
Ch<strong>in</strong>a<br />
6 500<br />
7 200<br />
10 000<br />
11 750<br />
16 550<br />
20 000<br />
Norway has <strong>the</strong> largest number of fully<br />
electric cars per capita <strong>in</strong> <strong>the</strong> world, thanks<br />
to a massive support <strong>and</strong> promotion plan<br />
that reduces <strong>the</strong> cost of an electric vehicle<br />
by as much as 50%.<br />
In 2016, electric vehicles represented nearly<br />
40% of all new passenger vehicles<br />
registered <strong>in</strong> Norway.<br />
United States<br />
4 750<br />
8 750<br />
France<br />
Ne<strong>the</strong>rl<strong>and</strong>s<br />
1 250<br />
7 100<br />
6 500<br />
6 250<br />
United K<strong>in</strong>gdom<br />
3 750<br />
6 200<br />
Japan<br />
3 000<br />
5 500<br />
Battery-driven electric vehicle<br />
Plug-<strong>in</strong> hybrid electric vehicle<br />
Source: Economic Commission for Lat<strong>in</strong> <strong>America</strong> <strong>and</strong> <strong>the</strong> <strong>Caribbean</strong> (ECLAC), on <strong>the</strong> basis of International Energy Agency (IEA), Global EV Outlook 2016: Beyond One Million<br />
Electric Cars, Paris, May 2016 [onl<strong>in</strong>e] https://www.iea.org/publications/freepublications/publication/Global_EV_Outlook_2016.pdf.<br />
Electric vehicle sales of have grown rapidly from about 130,000 units <strong>in</strong> 2012 to<br />
some 770,000 units <strong>in</strong> 2016, represent<strong>in</strong>g about 0.85% of <strong>the</strong> global vehicle market.<br />
There are now more than 2 million electric vehicles operat<strong>in</strong>g around <strong>the</strong> world, led<br />
by Ch<strong>in</strong>a with about 650,000 units. Between 2014 <strong>and</strong> 2016, <strong>the</strong> Ch<strong>in</strong>ese electric<br />
car market exp<strong>and</strong>ed more than sixfold <strong>in</strong> what was <strong>the</strong> world’s highest growth rate.<br />
In <strong>the</strong> same period, <strong>the</strong> number of manufacturers <strong>in</strong> this segment (with more than<br />
100 units sold) rose from 14 to 21, <strong>and</strong> <strong>the</strong> number of models available <strong>in</strong>creased<br />
from 29 to 68 (EV Volumes, <strong>2017</strong>). These results are based on a plan that requires all<br />
manufacturers to ensure that at least 8% of <strong>the</strong>ir production consists of electric vehicles<br />
by 2018, to atta<strong>in</strong> <strong>the</strong> goal of about 5 million units <strong>in</strong> circulation by 2020 (Fortune,<br />
<strong>2017</strong>f). Second placed is <strong>the</strong> United States with about 570,000 units, where <strong>in</strong>terest<br />
<strong>in</strong> electric vehicles is expected to cont<strong>in</strong>ue to grow strongly. This is demonstrated by<br />
<strong>the</strong> spectacular response to <strong>the</strong> announcement of Tesla’s new Model 3 <strong>in</strong> April 2016,<br />
which will be available <strong>in</strong> <strong>2017</strong>. This vehicle has a base price of US$ 35,000, for which<br />
about 400,000 reservations were made with a deposit of US$ 1,000 <strong>in</strong> <strong>the</strong> first 20 days<br />
follow<strong>in</strong>g <strong>the</strong> announcement (Forbes, <strong>2017</strong>e). In third place comes Japan, followed by<br />
Norway, surpris<strong>in</strong>gly given its size, <strong>and</strong> <strong>the</strong>n <strong>the</strong> Ne<strong>the</strong>rl<strong>and</strong>s, France <strong>and</strong> <strong>the</strong> United<br />
K<strong>in</strong>gdom. The impact of electric vehicles on <strong>the</strong> population, however, rema<strong>in</strong>s barely<br />
noticeable <strong>in</strong> most countries (see figure II.24).
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