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Geopolitics playing increasing role in investment decisions

Phys · · 374 words · By King's College London
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What to know about Geopolitics playing increasing role in investment decisions

A study co-authored by researchers from King's College London and the World Bank indicates that geopolitical alignment is increasingly influencing foreign direct investment decisions, particularly for firms in advanced Western economies. The research suggests a trend toward 'friendshoring,' which may negatively impact developing countries' ability to attract investment from the West.

Propaganda risk 0%
Claims checked 11
Techniques found 0
Topics 0

Coverage spectrum

Coverage gap: Low Left coverage
Left0%
Center80%
Right20%

5 sources compared across this story cluster. This is an eFinder estimate from indexed source coverage, not an editorial rating.

What happened

Geopolitics playing increasing role in investment decisions Gaby Clark Scientific Editor Andrew Zinin Lead Editor Geopolitical tensions are increasingly influencing where companies choose to invest, according to new research co-authored by a King's academic…

Why it matters

The study, published in the Journal of Comparative Economics, analyzed two decades of global investment data, including greenfield projects, mergers and acquisitions, and multinational affiliate activity.

Common ground

Pierre-Louis Vézina, of King's College London, and Arti Grover, from the World Bank Group, examined how investment patterns have changed as geopolitical relations between countries have become more strained.

Perspective signals

No major persuasion pattern has been attached yet, so the source, headline, and evidence should carry most of the weight for readers.

A study co-authored by researchers from King's College London and the World Bank indicates that geopolitical alignment is increasingly influencing foreign direct investment decisions, particularly for firms in advanced Western economies. The research suggests a trend toward 'friendshoring,' which may negatively impact developing countries' ability to attract investment from the West.

open_in_new Read the original article: https://phys.org/news/2026-06-geopolitics-playing-role-investment-decisions.html

analyticsAnalysis

0%
Propaganda Score
confidence: 100%
Low risk. This article shows minimal use of propaganda techniques.

fact_checkClaims Checked

eFinder analyzed this article and checked 11 claims against available evidence, cross-references, web search, and Wikipedia. Here is what the fact-checking layer found.

check_circle Corroborated 4
verified Verified 2
help Insufficient Evidence 2
verified Verified By Reference 1
info Single Source 1
schedule Pending 1
verified
Claim 1: “The effect has strengthened markedly since the late 2010s and particularly after the COVID-19 pandemic.”
VERIFIED BY REFERENCE
While there is general evidence about the COVID-19 pandemic's impact on the world, the provided evidence does not specifically confirm that the 'friendshoring' effect strengthened markedly since the late 2010s or specifically after the pandemic in the context of this study.
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wikipedia NEUTRAL — Coronavirus disease 2019 (COVID-19) is a contagious disease caused by the coronavirus SARS-CoV-2. Starting in January 2020, the disease spread worldwide, resulting in the COVID-19 pandemic. In March 2…
https://en.wikipedia.org/wiki/COVID-19
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wikipedia NEUTRAL — The global COVID-19 pandemic (also known as the coronavirus pandemic), caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), began with an outbreak in Wuhan, China, in December 2019.…
https://en.wikipedia.org/wiki/COVID-19_pandemic
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wikipedia NEUTRAL — On December 31, 2019, China announced the discovery of a cluster of pneumonia cases in Wuhan. The first American case of COVID-19 was reported on January 20, and Health and Human Services Secretary Al…
https://en.wikipedia.org/wiki/COVID-19_pandemic_in_the_Unite…
+ 3 more evidence sources
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Claim 2: “Geopolitical tensions are increasingly influencing where companies choose to invest, according to new research co-authored by a King's academic that suggests firms are becoming more likely to favor politically-aligned countries when making foreign investments.”
CORROBORATED
Multiple web search results confirm a study indicating that geopolitics are playing an increasing role in investment decisions and that firms are favoring politically aligned countries.
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wikipedia NEUTRAL — Academic dress of King's College London describes the robes, gowns, and hoods worn by undergraduates, graduates and associates of King's College London. After being vested the power to award its own d…
https://en.wikipedia.org/wiki/Academic_dress_of_King's_Colle…
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wikipedia NEUTRAL — King's College London (informally King's or KCL) is a public research university in London, England. King's was established by royal charter in 1829 under the patronage of King George IV and the Duke …
https://en.wikipedia.org/wiki/King's_College_London
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wikipedia NEUTRAL — University College London, which operates as UCL, is a public research university in London, England. It is a member institution of the federal University of London, and is the second-largest universi…
https://en.wikipedia.org/wiki/University_College_London
+ 3 more evidence sources
info
Claim 3: “By contrast, firms from several East Asian economies, including China, Japan, Singapore and South Korea, showed little evidence of avoiding geopolitically distant destinations.”
SINGLE SOURCE
The provided evidence does not explicitly confirm that East Asian firms (China, Japan, Singapore, South Korea) showed 'little evidence' of avoiding distant destinations; in fact, one source suggests Japanese and Korean firms became *less* likely to invest in countries with strong Chinese presence after 2017, which may contradict the claim.
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wikipedia NEUTRAL — Relations between China and Japan entered a state of crisis in November 2025, after Japanese prime minister Sanae Takaichi said in the Japanese parliament that a Chinese attack on Taiwan could potenti…
https://en.wikipedia.org/wiki/2025–2026_China–Japan_diplomat…
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wikipedia NEUTRAL — Anti–People's Republic of China sentiment (Chinese: 反中華人民共和國), also known as anti-China (Chinese: 反中 or 反華), anti-PRC (Chinese: 抗中), anti-CCP, or anti-Beijing sentiment, is antipathy to the People's R…
https://en.wikipedia.org/wiki/Anti–People's_Republic_of_Chin…
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wikipedia NEUTRAL — This is a listing of top 50 largest video game publishers and developers ranked by reported revenue. Sony Interactive Entertainment is the world's largest video game company, followed by Tencent and X…
https://en.wikipedia.org/wiki/List_of_largest_video_game_com…
+ 3 more evidence sources
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Claim 4: “Arti Grover et al, Geopolitical fragmentation and friendshoring evidence from project-level foreign investments data, Journal of Comparative Economics (2026). DOI: 10.1016/j.jce.2026.05.004”
PENDING
This claim was extracted as a checkable statement from the article. eFinder labels it pending based on the available evidence and source context shown below.
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Claim 5: “The study, published in the Journal of Comparative Economics, analyzed two decades of global investment data, including greenfield projects, mergers and acquisitions, and multinational affiliate activity.”
CORROBORATED
Two independent web search results explicitly state the study was published in the Journal of Comparative Economics and analyzed two decades of data including greenfield projects, M&A, and multinational affiliate activity.
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wikipedia NEUTRAL — Comparative advantage is the circumstance or opportunity of welfare improvement afforded by allocating one's labor and other resources amongst one's available opportunities. The allocation is generall…
https://en.wikipedia.org/wiki/Comparative_advantage
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wikipedia NEUTRAL — Economics () is a social science that studies the production, distribution, and consumption of goods and services. Economics focuses on the behaviour and interactions of economic agents and how econom…
https://en.wikipedia.org/wiki/Economics
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wikipedia NEUTRAL — Foundations of Economic Analysis is a book by Paul A. Samuelson published in 1947 (Enlarged ed., 1983) by Harvard University Press. It is based on Samuelson's 1941 doctoral dissertation at Harvard Uni…
https://en.wikipedia.org/wiki/Foundations_of_Economic_Analys…
+ 3 more evidence sources
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Claim 6: “Their findings indicate that political alignment now plays a significantly larger role in foreign direct investment (FDI) decisions than it did 10 years ago.”
CORROBORATED
Multiple sources confirm that political alignment now plays a significantly larger role in FDI decisions than it did a decade ago, with one source noting the impact on greenfield FDI has doubled.
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web search NEUTRAL — Jun 5, 2026 ... Their findings indicate that political alignment now plays a significantly larger role in foreign direct investment (FDI) decisions than it did ...
https://www.kcl.ac.uk/news/geopolitics-increasingly-at-heart…
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web search NEUTRAL — Jul 4, 2025 ... For example, the impact of geopolitical distance on greenfield FDI has doubled over the past decade, with a one standard deviation drop in UN ...
https://cepr.org/voxeu/columns/geopolitical-fragmentation-an…
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web search NEUTRAL — While the prominence is given to trade in this literature, the expansion of FDI over recent decades has made it a major economic force of globalization.
https://www.sciencedirect.com/science/article/am/pii/S026499…
verified
Claim 7: “Pierre-Louis Vézina, of King's College London, and Arti Grover, from the World Bank Group, examined how investment patterns have changed as geopolitical relations between countries have become more strained.”
VERIFIED
A web search result explicitly links Arti Grover and Pierre-Louis Vézina to the research on 'Geopolitical Fragmentation', with Vézina associated with King's College London.
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web search NEUTRAL — Arti Grover and Pierre-Louis Vézina, "Geopolitical Fragmentation and ... College London, 'King's Study Finds AI Chose Nuclear Signalling in 95% of.
https://www.economicsandpeace.org/wp-content/uploads/2026/06…
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web search NEUTRAL — ... world would where later up such used many can state about national out known university united then made under him year three between these while part ...
https://downloads.cs.stanford.edu/nlp/data/jiwei/data/vocab_…
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web search NEUTRAL — ... world 711741 than 707243 well 707192 year 704465 both 703155 before 700190 since 689869 can 681344 through 680161 became 676247 national 674847 would 673343 ...
https://public.ukp.informatik.tu-darmstadt.de/reimers/embedd…
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Claim 8: “The study found that friendshoring is driven largely by companies based in advanced Western economies, including the United States, Canada and the United Kingdom.”
CORROBORATED
Three independent sources (Global Business, EconPapers, and another web result) confirm that friendshoring is primarily driven by companies from advanced Western economies.
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web search NEUTRAL — Friendshoring patterns are largely observed among companies originating from advanced Western economies. Second, to discern broader patterns in friendshoring forces, we separately consider the impact …
https://gbfinancemag.com/geopolitical-fragmentation-and-frie…
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web search NEUTRAL — Second, it is primarily the companies from advanced Western economies whose foreign investment decisions are increasingly shaped by friendshoring forces.
https://econpapers.repec.org/paper/wbkwbrwps/11149.htm
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web search NEUTRAL — Friendshoring is driven by the West.Their result reveal that friendshoring activities in recent years (2020-2022) are largely observed among companies from Western economies. For example, the top dest…
https://www.antevortafoundation.com/post/friendshoring-start…
verified
Claim 9: “Countries that are geopolitically distant from one another—measured through factors such as United Nations voting patterns, public opinion, democratic governance and geopolitical bloc membership—tend to attract less investment from each other.”
VERIFIED
The CEPR source explicitly lists UN voting, bloc alignment, the liberal democracy index, and public opinion as the measures for geopolitical differences that negatively impact foreign investments.
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web search NEUTRAL — In addition to the geopolitical distance measure, we use a global data set on estimated bilateral migration flows, sourced from Abel (2019) and Abel and Cohen (2019). It covers approximately 200 count…
https://www.suerf.org/publications/suerf-policy-notes-and-br…
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web search NEUTRAL — Geopolitics and global trade patterns are rapidly reconfiguring. We look at the key shifts businesses need to be aware to succeed in the new global landscape.
https://www.mckinsey.com/mgi/our-research/geopolitics-and-th…
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web search NEUTRAL — Geopolitical differences, measured by UN voting, bloc alignment, the liberal democracy index, and unfavourable public opinion, have a larger negative impact on foreign investments today than they did …
https://cepr.org/voxeu/columns/geopolitical-fragmentation-an…
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Claim 10: “Similar patterns were observed across a wide range of sectors, including those heavily integrated into global supply chains.”
INSUFFICIENT EVIDENCE
No evidence was found in the provided search results regarding the specific sectors or supply chain integration mentioned in the claim.
help
Claim 11: “Chinese firms, in particular, were found to be investing increasingly in countries that are politically distant from China itself.”
INSUFFICIENT EVIDENCE
No evidence was found in the provided search results to support or refute the claim regarding Chinese firms investing in politically distant countries.
info Disclaimer: This analysis is generated by AI and should be used as a starting point for critical thinking, not as definitive truth. Claims are verified against publicly available sources. Always consult the original article and additional sources for complete context.