After 2022, the record year for FDI in Greece, FDI declined in 2023 following the global trend of declining FDI, the main reasons for which are economic recession and geopolitical tensions, as well as the rising cost of money.
According to the World Investment Report of the United Nations Trade and Development Organization (UNCTAD), issued Thursday, the total volume of foreign direct investment in Greece reached $5.43 billion in 2023, compared to $8.45 billion in 2022. Despite this decline, the performance of 2023 is higher than 2019 and among Highest rates ever. Overall, in the period 2019-2023, the value of foreign direct investment reached $28.44 billion.
Aside from the fact that total FDI in Greece decreased by about 36% in 2023 compared to 2022, the most worrying element, as shown in the relevant data released by the Bank of Greece, is that the majority of FDI, approximately 28%, related to the real estate sector. If we add to this percentage the foreign direct investments made in 2023 related to private real estate deals, then about 45% of the foreign direct investments were in the real estate sector. Foreign direct investment in industries aimed at expanding the production base, such as manufacturing and logistics, accounted for 16.86% and 1.73% of the total in 2023, respectively.
Much lower than in 2022 were so-called new investments (i.e. completely new investments – not the acquisition of existing companies but the creation of new businesses or expansion with new investments), according to the UNCTAD report, amounting to $1.2 billion compared to $1.89 billion in 2022. 2022 recorded A decrease of 36.2%. Of the total foreign direct investment in Greece in 2023, investments in new areas accounted for 22%. It should be noted that in the period 2019-2023, after fiscal simplification but with the pandemic, investments in new areas amounted to a total of $10.03 billion, i.e. about 36% of the total foreign direct investment in this period.
Moreover, there has been a sharp decline in foreign direct investment associated with mergers and acquisitions by foreign capital. These amounts amounted to only $231 million in 2023, compared to $5.6 billion in 2022, a decrease of 95.6%.