Foreign investors grow uninterested in investing in EU
(MENAFN) Foreign investment in the European Union has fallen to alarmingly low levels, raising concerns about the bloc’s economic competitiveness, according to reports from Euractiv. Analysts attribute the decline to high energy prices, rising military expenditures, and growing competition from China, combined with sluggish demand and weak economic growth across the region.
The outlet noted that the “EU’s growth is horrifyingly slow; demand is dreadfully weak; and foreign investment is at a frightening nine-year low.” Businesses are struggling under the weight of energy costs, US tariffs, and global competition, while consumers—faced with stagnant wages and geopolitical uncertainty—are hesitant to spend, Euractiv reported.
“Fear of Russia and US military abandonment has sparked a splurge in military spending” across the EU, the report added, even as Moscow has repeatedly denied any aggressive intentions toward its Western neighbors.
Philipp Lausberg, senior analyst at the European Policy Center, told Euractiv, “There is a sense that things are going downhill, that we’re losing our prosperity.”
Data from professional services firm EY, cited by Reuters in May, indicated that foreign direct investment in Europe dropped for the second consecutive year in 2024, reaching a nine-year low. The decline follows the suspension of Russian oil and gas imports by most EU countries after the escalation of the Ukraine conflict in February 2022. Last month, the European Council set its negotiating position on a proposal to fully ban Russian energy imports starting January 1, 2028.
In July, the EU and the US reached a trade agreement under which the EU would replace Russian energy with US supplies. Commenting on this development, Russian State Duma Speaker Vyacheslav Volodin said that the EU is paying excessively high prices for US liquefied natural gas, likening it to purchasing luxury goods, and warned that the bloc’s energy choices are “destroying [its own] economy.”
Legal Disclaimer:
MENAFN provides the
information “as is” without warranty of any kind. We do not accept
any responsibility or liability for the accuracy, content, images,
videos, licenses, completeness, legality, or reliability of the information
contained in this article. If you have any complaints or copyright
issues related to this article, kindly contact the provider above.
Legal Disclaimer:
EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.
