With output back at pre-pandemic levels, better performance among companies that didn’t lay people off, and a leap in the proportion planning to invest, the World Bank’s Q2 2021 Pulse Survey on foreign investment trends, carried out by EY, suggests a return to form for MNEs operating in developing countries.
That said, certain regions seem to be falling behind, indicating a twin-track recovery. And while the proportion of companies planning to increase their investment levels has gone up, lingering uncertainty is preventing most from changing their plans.
In this article, we’ve collated the findings into seven insights to help investors, businesses and governments navigate the changing investment landscape. Click here to read the full report.
1. Overall, output is back to pre-pandemic levels even if smaller companies are still more impacted
On average, the level of output among MNEs in developing countries was 0.6% higher than before the crisis. And, while differences remain between sectors and business models, the gap between SMEs, defined as companies with fewer than 250 employees and large companies has shrunk. In Q1, average output was 2.3% lower for SMEs than pre-pandemic and 3.7% higher for large companies. In Q2, average output was 0.3% lower for SMEs and 1.3% higher for large companies.