Jobs created in Ireland through Foreign Direct Investment (FDI) last year fell by 42pc to 7,500.
The NIB/fDi intelligence monitor found that the number of jobs created worldwide through foreign direct investment fell by 25pc from 2008.
In 2008, there were 12,900 jobs created by FDI in Ireland but this dropped to 7,500 in 2009.
NIB economist Dr Ronnie O'Toole said the weakening of the euro and the country's international standing were behind the drop.
"The particularly sharp fall in investment in Ireland is largely due to the negative perceptions Ireland has suffered following the rapid increase in unemployment and the sharp deterioration in the Government's finances over the last 18 months," he said.
Europe fared worse than average in the world rankings, recording a 33pc drop in jobs.
When the amount of money invested was taken into account, Ireland slipped from 21st to 23rd of 30 countries. China was top, the US was second and India third.
However, Dr O'Toole said that Ireland's place in the index was still higher than could be expected given its size, pointing out that it was ahead of countries such as Sweden and Denmark.
Ireland attracted 0.7pc of all global foreign direct investment last year while the Irish economy accounts for just 0.3pc of the world economy.
"Ireland remains an attractive place for foreign investment, though clearly the reputational issue caused us problems last year," Mr O'Toole said.