Greenfield investments, which refer to the establishment of new facilities in a foreign country, have been gaining momentum in recent years. In 2022, foreign direct investors spent a staggering $5.3 billion on US greenfield manufacturing projects, indicating a significant surge in overseas investments. This trend reflects the growing importance of establishing new production sites to address supply chain issues and meet the increasing demand for goods and services.
One notable greenfield investment is Intel's new semiconductor assembly and test facility located near Wroclaw, in western Poland. Polish Prime Minister expressed his excitement, emphasizing that it will be the largest greenfield project in the country. This investment not only underscores the attractiveness of Poland as an investment destination but also highlights the importance of greenfield investments in the technology sector.
However, the United Nations Conference on Trade and Development's (UNCTAD) World Investment Report 2023 reveals a concerning trend. Developing countries are facing a widening annual investment deficit as they strive to achieve sustainable economic growth. This deficit highlights the need for increased foreign direct investments, particularly in the form of greenfield projects, to bridge the gap and support development efforts.