Global foreign direct investment (FDI) fell 3 per cent in the first half (H1) of 2025, extending a two-year slump as trade tensions, high interest rates, and geopolitical uncertainty kept investors cautious, according to UN Trade and Development (UNCTAD).

The drop was driven by developed economies, where cross-border mergers and acquisitions (M&As)—which normally make up a large share of their FDI—fell 18 per cent to $173 billion, UNCTAD said in its latest Global Investment Trends Monitor.

Global FDI declined 3 per cent in H1 2025, marking a continued two-year slump as trade tensions, high borrowing costs, and geopolitical uncertainty curbed investor confidence, according to UNCTAD.
Developed economies saw an 18 per cent fall in M&As.
Greenfield and renewable projects dropped sharply, though AI-driven investments and sovereign wealth fund activity may aid recovery later in 2025.

Developing economies fared better overall, with flows remaining flat, though trends diverged by region. Inflows rose 12 per cent in Latin America and the Caribbean, 7 per cent in developing countries in Asia but fell 42 per cent in Africa.

High borrowing costs and economic uncertainty continued to squeeze investment in industry and infrastructure in H1 2025. Announcements of greenfield projects—when firms build new operations abroad—fell 17 per cent in number, driven by a 29 per cent decline in supply-chain-intensive manufacturing such as textiles, electronics, and automotives amid tariff uncertainty.

The international project finance—critical for infrastructure development—also declined, with deal numbers down 11 per cent and value 8 per cent. The trend was more positive in developing economies, where project finance deals fell only 2 per cent after two years of sharp declines. Despite fewer deals, the total value jumped 21 per cent, lifted by a few large-scale projects in Panama, the United Arab Emirates, and Uzbekistan. A broad recovery has yet to emerge.

Despite fewer projects, the value of global greenfield investment rose 7 per cent, lifted by major projects in artificial intelligence (AI) and the digital economy. For example, the United States recorded $237 billion in new greenfield projects in H1 2025—nearly matching the 2024 total and four times the past decade’s half-year average. More than half of the value came from AI-related sectors, particularly semiconductors (~$103 billion) and data centres (~$27 billion).

Investment in sectors critical to the Sustainable Development Goals (SDGs) continued to fall in early 2025. SDG-related investment projects in developing countries were down 10 per cent in number and 7 per cent in value, following steep declines last year. Projects in least developed countries (LDCs) are on track to fall another 5 per cent in 2025, possibly hitting their lowest level since 2015.

Internationally financed projects—including those in transport and utilities—remained about 25 per cent below the decade average. In LDCs, project finance in infrastructure fell another 85 per cent in value. Greenfield infrastructure activity declined 31 per cent in value and 25 per cent in number, led by sharp contractions in Latin America and the Caribbean (–78 per cent in value and –43 per cent in number).

Renewable energy investment, the largest SDG-relevant sector, also weakened. Globally, international project finance in the sector—which has accounted for nearly two-thirds of global totals in recent years—fell another 9 per cent in number and 10 per cent in value.

Global greenfield projects in renewable energy also declined 55 per cent in number and 21 per cent in value. In developing economies, projects fell 23 per cent. In LDCs, they declined by 31 per cent in number and 18 per cent in value.

Investment in water and sanitation fell 40 per cent, with no new projects in Africa or LDCs and a 97 per cent decrease in Latin America and the Caribbean. Only agrifood systems and health showed positive trends in developing economies, with investment holding steady in agrifood and rising 37 per cent in health, driven primarily by new projects in Asia.

The global investment climate will remain challenging through the rest of 2025. Geopolitical tensions, regional conflicts, economic fragmentation, and efforts to de-risk supply chains continue to weigh on flows. Still, easing financial conditions, rising M&A activity in the third quarter, and higher overseas spending by sovereign wealth funds could support a modest rebound by year-end.

Fibre2Fashion News Desk (SG)

Bangladesh’s economy is still facing significant pressure, according to the International Monetary Fund (IMF), which recently advised the country’s central bank to make the interest rate structure more market-oriented.

During a meeting with Bangladesh Bank officials last week, the IMF stressed the need to maintain a contractionary monetary policy to bring inflation down to 5 per cent.

Bangladesh’s economy is still facing significant pressure, the IMF said, advising the country’s central bank to make the interest rate structure more market-oriented.
It stressed the need to maintain a contractionary monetary policy to bring inflation down to 5 per cent.
It is concerned over the use of foreign reserves in forming the Export Development Fund and the growing volume of non-performing loans.

It also expressed concern over the use of foreign reserves in forming the Export Development Fund (EDF) and the growing volume of non-performing loans (NPLs).

Despite a requirement under the loan conditions to reduce bad loans in state-owned banks below 10 per cent, the figure has reportedly exceeded 40 per cent. Private banks also saw their NPL ratio surpass 10 per cent, double the stipulated 5 per cent limit.

Under the IMF’s $4.7 billion loan programme, Bangladesh has yet to fully achieve its inflation-control target.

The central bank informed the visiting IMF delegation that overall inflation had dropped to 8.36 per cent in September.

The IMF sought clarification on how the central bank plans to maintain investment momentum if the contractionary policy continues for an extended period, according to domestic media reports.

The delegation strongly objected to the bank’s practice of providing unsecured liquidity support to weak banks under its ‘lender of last resort’ policy.

It was satisfied with the current level of Bangladesh’s foreign exchange reserves.

The IMF mission will stay in Dhaka until November 13.

Fibre2Fashion News Desk (DS)

German sportswear giant Puma has reported a 10.4 per cent decline in sales on a currency-adjusted basis to €1,955.7 million (~$2.27 billion) in the third quarter (Q3) of 2025, or 15.3 per cent on a reported basis, primarily reflecting reduced wholesale exposure, distribution streamlining, and lower promotional activity in e-commerce, as part of its ongoing strategic reset aimed at strengthening long-term brand health.

The gross profit margin fell by 260 basis points to 45.2 per cent, primarily due to elevated promotional activity in the wholesale channel, inventory write-downs, and increased freight costs. This was partially cushioned by a favourable mix shift towards direct-to-consumer (DTC).

Puma’s Q3 2025 sales have declined 10.4 per cent on a currency-adjusted basis to €1,955.7 million (~$2.27 billion) amid distribution clean-up, reduced wholesale exposure, and fewer e-commerce promotions.
The brand reported a net loss of €62.3 million (~$72.3 million) and a 45.2 per cent gross margin.
CEO Arthur Hoeld reaffirmed 2025 as a ‘year of reset’.

Operating expenses, excluding one-time costs, decreased 2.6 per cent to €850.6 million, reflecting early benefits from the cost-efficiency programme. However, marketing costs rose as a share of sales due to reduced revenues. Adjusted EBIT dropped sharply to €39.5 million from €237.0 million a year earlier, while reported EBIT came in at €29.4 million after accounting for €10.1 million in one-time restructuring costs. Consequently, the EBIT margin fell to 1.5 per cent. Net loss stood at €62.3 million compared with a €127.8 million net profit in the same period last year. Earnings per share came in at negative €0.42.

The company faced multiple challenges during the quarter, including muted brand momentum, elevated inventory levels across the trade, and lower-quality distribution, as part of its ongoing strategic reset aimed at strengthening long-term brand health by reducing undesirable wholesale business, curbing promotions, and improving inventory quality, Puma said in a press release.

Wholesale revenue decreased 15.4 per cent (currency-adjusted) to €1,385.7 million, reflecting reduced exposure to low-margin channels in North America, Europe, Middle East, and Africa (EMEA), and Latin America. The company also phased out undesirable business and executed significant takebacks to clear excess inventory from trade partners.

DTC sales, however, grew by 4.5 per cent (currency-adjusted) to €570 million, driven by a 5.6 per cent increase in e-commerce and a 3.9 per cent rise in owned and operated retail stores. This boosted the DTC share to 29.1 per cent from 25.1 per cent in Q3 2024, as the company shifted focus towards higher-margin, brand-controlled channels.

Sales fell across all key regions due to the ongoing reset. In the Americas, sales decreased 15.2 per cent (currency-adjusted) to €678.1 million, largely due to reduced exposure to mass merchants in North America. The US market was particularly affected given its significant share of wholesale business. The Asia/Pacific region recorded a 9 per cent decline to €367.1 million, primarily due to a drop in Greater China’s wholesale business, partially offset by growth in DTC. In the Europe, Middle East, and Africa (EMEA) region, sales declined 7.1 per cent to €910.6 million, impacted by takebacks and the deliberate scaling back of low-quality wholesale business.

All product divisions were affected by the strategic reset. Footwear sales declined by 9.9 per cent (currency-adjusted) to €1,045.8 million, with broad-based softness across most categories. Nonetheless, the Speedcat family within the Sportstyle Prime segment performed well, especially in the Asia-Pacific region. Performance categories such as Basketball and Performance Running showed resilience, driven by successful launches like the HALI 1 basketball shoe and Velocity NITRO 4 running shoe.

Apparel sales decreased by 12.8 per cent to €635.5 million, reflecting weaker performance in Sportstyle, while growth in Training—bolstered by Puma’s exclusive HYROX partnership—along with Motorsport and Basketball, provided partial offsets. Accessories declined 6.1 per cent to €274.4 million.

For the first nine months of 2025, Puma’s sales decreased 4.3 per cent (currency-adjusted) to €5,973.9 million, while reported sales dropped 8.5 per cent. Wholesale declined 8.6 per cent, while DTC rose 8.4 per cent—driven by strong e-commerce growth of 14.2 per cent and retail growth of 5.2 per cent. DTC’s share of total sales increased to 28.8 per cent from 25.5 per cent.

Gross profit margin for the nine months decreased 130 basis points to 46.1 per cent due to higher promotions and currency headwinds. Adjusted EBIT fell to €102.0 million from €513.2 million, while one-time costs and impairments led to a reported EBIT loss of -€10.7 million. The company posted a net loss of €308.9 million for the period, compared to a €257.1 million profit in 2024.

“At the end of July, we stated that 2025 would be a year of reset. Since then, we have taken important steps to clean up Puma’s distribution, improve our cash management and reset our operational expenses. By expanding our cost efficiency programme, we are moving quickly to address challenges and make the business more efficient and resilient. With third-quarter results meeting our expectations, we remain committed to executing these measures with discipline,” said Arthur Hoeld, chief executive officer (CEO) of Puma.

“I strongly believe the Puma brand has incredible potential with more than 77 years of history, one of the best product archives in the industry and huge credibility in many major sports. We have identified the areas in which we need to take decisive action and outlined our strategic priorities to become one global sports brand with globally resonating product ranges and inspiring storytelling across markets. With these strategic priorities, we have the clear ambition to establish Puma as a Top 3 sports brand globally, returning to above industry growth and generating healthy profits in the medium term,” added Hoeld.

Puma has expanded its cost-efficiency programme to include a targeted reduction of approximately 900 additional white-collar roles globally by the end of 2026. The company expects these actions, alongside its distribution reset and focus on brand consistency, to create a leaner and more agile operating structure, added the release.

Despite ongoing macroeconomic and geopolitical uncertainty, Puma confirmed its full-year 2025 outlook, expecting sales to decline by a low double-digit percentage on a currency-adjusted basis and a reported EBIT loss for the year. Capital expenditures are projected around €250 million.

Fibre2Fashion News Desk (SG)