The Unctad's Global Investment Trends Monitor has predicted that global foreign direct investment (FDI) flows will see a drastic fall up to 40 percent during 2020-2021.
The prediction also says it will reach the lowest level in the past two decades with the global spread of Covid-19 strongly affecting foreign investment.
Earlier in March, the Unctad had projected that coronavirus might eat up 15 percent of global FDI.
A special issue of Unctad's Investment Policy Monitor (IPM) was released on May 4.
The Unctad's IPM highlighted that countries are putting in place a variety of investment policies in response to the coronavirus pandemic.
The investment policies which have been taken by countries include facilitation and retention of investment, providing incentives, financial support to crisis-affected companies, supporting local small and medium-sized enterprises in supply chains, as well as protecting national security and public health through foreign investment screening.
The monitor documents and analyses show the global spread of Covid-19 is also impacting the negotiation of international investment agreements (IIAs).
It is likely that 2020 will register the lowest number of IIAs concluded since 1985, says the report.
Secretary General of Unctad Dr Mukhisa Kituyi, said, "National and international investment policies can and should contribute to tackling the devastating economic and social effect of the pandemic."
"Above all, they can incentivise production of medical equipment and drugs, facilitate administrative procedures, provide equity capital to struggling companies and ensure that foreign takeovers are not contrary to the national public interest," he added.