Prospects are good for maintaining the trend this year and in 2006, the UN Conference on Trade and Development (Unctad) said in its annual study of foreign direct investment.

"The high level of FDI to developing countries is likely to be sustained," said Anne Miroux, who steers Unctad's World Investment Report.

Multinationals "are seeking to improve their competitiveness by expanding in the fast-growing markets of emerging economies and by seeking new ways to reduce costs," she said.

Developing nations in Asia are the biggest winners, Unctad noted.

Globally, foreign direct investment flows last year reached 648 billion dollars, two percent higher than in 2003.

Behind that figure lie diverging trends, said Unctad.

FDI in developing countries surged by 40 percent to 233 billion dollars, the second-highest amount ever recorded.

In the developed world it fell 14 percent to 380 billion dollars, with much of the decline tied to repayments of intra-company loans and capital repatriation from western Europe by foreign parent companies.

The United States remained the top recipient of FDI, drawing 96 billion dollars of the total, followed by Britain, mainland China, Luxembourg, Australia, Belgium, Hong Kong, France, Spain and Brazil.