The Global Investor: Opportunities Across Borders

In a world of interconnected markets, cross-border investing offers unprecedented possibilities—and challenges. This comprehensive guide equips global investors with data-driven insights to navigate 2025’s landscape.

Global FDI: A Shifting Terrain

After reaching a record $41 trillion in 2023, global foreign direct investment (FDI) fell by 11% to $1.5 trillion in 2024. This marks the second consecutive year of declines, driven by economic fragmentation, high interest rates, and geopolitical tensions.

Projections for 2025 diverge: some analysts forecast a 4.9% rebound as markets stabilize, while others anticipate a further 3% dip, particularly in developed economies. Against this backdrop, understanding top destinations and regional shifts is vital.

Top Destinations and Regional Trends

The United States remains the primary recipient, securing $76 billion in Q1 2024 and leading FDI inflows for 12 consecutive years. Canada and China follow, with China’s relaxed capital controls in major cities fueling its rise to third place.

Emerging markets such as India, Mexico, and Brazil each recorded record inward FDI growth of around 20%, or roughly $130 billion. Singapore, too, posted an unprecedented gain of $307 billion in 2023.

Sector Focus: Private Markets and Infrastructure

Private markets encountered tepid dealmaking and the lowest fundraising since 2016, yet capital deployment climbed by double digits as investors adapted to higher rates. Nearly 30% of leading institutional investors plan to increase allocations to private equity in 2025, drawn by diversification and long-term performance advantages.

Real estate saw its first positive growth in deal value in three years, rising 11% to $707 billion. Data centers delivered 11.2% returns, while multifamily and industrial properties also attracted significant capital. Infrastructure deals surged 18%, backed by global trade volumes of $33 trillion and the green energy transition.

Tech, Digital, and Sustainable Themes

Investment in AI reached $33.9 billion globally in 2024, up 18.7% year-on-year. The U.S. led private AI investment at $109.1 billion—twelve times China’s $9.3 billion. Governments are equally committed: China’s $47.5 billion semiconductor fund, France’s €109 billion digital agenda, and Saudi Arabia’s $100 billion tech initiative exemplify this trend.

Impact investing assets under management have grown at a 21% CAGR over six years, jumping 11% from 2024 to 2025. This structural shift toward sustainable strategies underscores investors’ dual pursuit of returns and positive environmental outcomes.

Key Opportunities and Risks

• Digital Infrastructure: Data centers, cloud networks, AI-driven industries.
• Clean Energy & Infrastructure: Renewable power, smart transport, logistics hubs.
• Emerging Markets Growth: India, Mexico, Brazil, and Southeast Asia’s reforms fueling expansion.
• Alternative Asset Classes: Impact funds, private credit, specialty real estate.

• Regulatory Uncertainty: Cross-border technology, AI, and digital services face evolving rules.
• Geopolitical Volatility: U.S.-China tensions, currency fluctuations, and regional disparities.
• Venture Capital Pullback: Deal values in Asia outside of India and ASEAN are contracting.
• Active Ownership Pressure: Higher rates demand operational improvements over passive strategies.

Macroeconomic and Geopolitical Backdrop

Global growth is forecast at 2.3% in 2025, with a sluggish recovery expected through 2027. Inflation pressures and central bank policy shifts continue to influence asset pricing and risk premia. Persistent geopolitical fragmentation, especially U.S.-China relations, shapes the technology and digital regulatory environment.

Cross-border investors must calibrate regional portfolios to reflect these dynamics, balancing safe-haven allocations in the U.S. and Europe with higher-growth exposures in Asia-Pacific and select emerging markets.

Performance Benchmarks: A Data Table

Strategic Takeaways for Investors

To capitalize on cross-border opportunities in 2025, investors should pursue a regionally differentiated strategy, reweighting from China toward India, ASEAN, and Latin America while maintaining safe-haven exposure in developed markets.

Policy, sustainability, and digitalization will remain decisive factors. Investors should integrate ESG criteria, prioritize digital infrastructure, and seek partnerships that mitigate regulatory risk.

Ultimately, success hinges on adaptive asset allocation, active portfolio management, and a deep understanding of local market dynamics. By leveraging data-driven insights and strategic themes outlined here, global investors can navigate uncertainties and unlock growth across borders.