INTRODUCTION Contributed by: G. J. Ligelis Jr, Cravath, Swaine & Moore LLP
Global Overview The benefits of globalisation have been touted for decades now. For the developed world, globalisation can bring access to new markets, solutions for opti - mising supply chains, connection with a global talent pool and diversification of revenues. For the devel - oping world, globalisation can provide critical capital investment, importation of cutting-edge technology and expertise, and boosts to local employment and the economy at large. However, the past decade has also shone a light on some of the costs of globalisation, and the tide appears to be turning on the post-Cold War order erected on the back of globalisation. In recent years, businesses with a web of suppliers across the globe have become exposed to the fickle effects of shifting tax regimes, unpredictable supply chains, trade and actual wars, and global health crises. Countries that offshored large portions of their manu - facturing base have been faced with divisive social consequences at home, arising from disempowered and unemployed segments of the population. Gov - ernments that have provided open access to foreign investment in critical industries have found key assets in the hands of geopolitical rivals or businesses with unknown or opaque ties to foreign governments or state-owned enterprises. Developing nations have learned the hard way that the tap of foreign investment can be shut off as quickly as it is turned on – with dire consequences for currencies, capital accounts and economies. Nonetheless, while businesses may ensure more local supply redundancies and governments may erect bar - riers to entry for geopolitical foes, capital is likely to continue to follow its inexorable path to profitable investment. Navigating this complex and precarious environment for foreign direct investment (FDI) will only increase the demand for sound legal, financial, tax and operational advice for businesses that choose to look abroad for expansion, ideas and talent. As one of the most direct proxies for globalisation, FDI has followed a similar rocky path. In 2024, when excluding certain conduit countries, global FDI flows
decreased by 11% to USD1,493 billion, according to the UN Conference on Trade and Development. In 2024, the decline was more pronounced in greenfield investments than in cross-border mergers and acqui - sitions (M&A). Cross-border M&A increased by 14% in 2024 to reach USD443 billion, but remained below the average of the past decade. Greenfield FDI announce - ments (which reflect future investment plans) rose 3% in 2024, mainly in technologically and politically stra - tegic sectors, such as data centres, semiconductors, energy and advanced manufacturing, but total value declined by 5% compared to 2023. Global FDI flows in the first quarter of 2025 reached USD408 billion, which was 15% lower than in the first quarter of 2024 and 19% below the first quarter of 2023. While inflation and interest rates have come down from peak levels, constant geopolitical crises and increasingly protectionist domestic politics con - tinue to negatively impact global FDI flows in countries around the world. Throughout 2024, the USA was both the largest source of outbound FDI flows and the largest destination for inbound FDI flows. The US market continues to lead the global recovery and remain a few steps ahead of its peers in the developing world while continuing to tackle inflation and lower interest rates. Introduction to the Guide As a brief introduction to the content of this Cham - bers Global Practice Guide, Investing In... 2026, the purpose of each country-specific chapter is to pro - vide the reader with an understanding of the key legal issues that arise from investing in the subject country and to serve as a reference point for the key factors and considerations that should be evaluated prior to making a foreign investment in that country. The Guide generally adopts the OECD definition of FDI for the types of investments that are addressed, which is an investment that reflects the objective of establishing a lasting interest (ie, a long-term relation - ship with a significant degree of influence on manage - ment) by an enterprise residing in one jurisdiction in an enterprise that resides in another jurisdiction. This includes transactions such as mergers and acquisi -
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