The USA is the largest recipient of Foreign Direct Investment in the world, with amounts in excess of $4.46 trillion invested in the country as of the end of 2018.
Today we will discover some of the key USA Foreign Direct Investment (FDI) numbers, look at FDI in the Florida market, Portfolio Assets owned by foreigners, and how the FDI annual flow (difference between foreign investment in USA and US investment abroad) could increase with the trade-friendly policies of the new administration.
In today’s article:
1. Foreign Direct Investment Total Stock Numbers in USA
2. FDI Numbers in Florida
3. Foreign Owned Portfolio Assets
4. FDI Annual Flow over last 4 years
5. Solid Sectors for International Investors: Equity, Property
6. Immigration investments: EB5 / E2 Visas
Key Foreign Direct Investment Numbers in America
Let’s take a look at the some of the FDI numbers in the USA, according to the selectusa.gov website.
- The foreign direct investment in the United States position increased $331.2 billion to $4.46 trillion total stock at the end of 2019, from $4.13 trillion at the end of 2018.
- American FDI was concentrated in the US manufacturing sector, at 40.1 percent. There was also sizable investment in finance and insurance (12.3 percent) and wholesale trade (10.5 percent).
- There was $253.6 billion FDI annual flow in 2018.
- By country of the foreign parent, five countries accounted for more than half of the total position at the end of 2019. Japan, UK, Canada, Netherlands and Germany.
- By country of the ultimate beneficial owner (UBO), the top five countries were Japan ($644.7 billion), Canada ($580.8 billion), Germany ($522.0 billion), the United Kingdom ($446.2 billion), and Ireland ($343.5 billion).
FDI Numbers in Florida
BAI Capital is based out of Miami Florida. With that in mind, we will share some Foreign Direct Investment numbers for the state of Florida.
- Since 2014, over 300,000 jobs in Florida have been created annually by Foreign Direct Investment.
- In 2018 358,700 jobs were sustained by majority owned foreign affiliates.
- Investment % by Country: 19% United Kingdom, 19% Spain, 11% Germany, 10% Canada, 6% France, 46% Other
- Investment by Project, 111 Business Services, 110 Software and IT Services, 101 Financial Services, 53 Transportation and Warehousing, 41 Communications, 393 Other
- These numbers don’t include all the capital invested by individual foreign nationals of other countries. Read more below.
Foreign Owned Portfolio Assets Data
According to Market Watch
- As of 2016 foreigners owned about $17 trillion worth of US portfolio assets.
- According to that data, foreigners owned 48% of all Treasury debt.
- In 2016 foreigners owned about 25% of outstanding corporate bonds, 15% of American stocks and 12% of agency securities (a category that includes mortgage-backed debt).
FDI Annual Flow
While total Foreign Direct Investment has been steadily rising over the last 20 years, the flow between foreign investment in the States and US investments abroad has been dropping in recent years.
According to some sources, US FDI Annual Flow in 2021 looks to increase with the new Biden administration in power.
A little background:
From 2016 to 2017, the first year of the Trump administration, FDI annual flow dropped 42%, in part due to the tariffs and unilateral treaties enacted by that administration
Foreign investment annual flow in the United States fell by almost half, or 49 percent, in 2020 to $134 billion, according to figures released on Sunday by the United Nations Conference on Trade and Development.
This is most likely due to COVID, combined with the ongoing tariffs.
So, while total Foreign Direct Investment has been steadily rising over the last 20 years, the flow between foreign investment in the States and US investments abroad has been dropping in recent years.
The new Biden Administration will re-open up doors abroad by bolstering multi-lateral trade agreements, renewing old alliances that were de-prioritized in the last regime, as well as removing many Trump era economic sanctions.
Solid Portfolio Assets for International Investors: Equity Real Estate Funds, Property Investment
As it stands, wealthy foreign investors can take advantage of the immense diversity of opportunities in the USA, Private Equity and Property Investment being just 2 of them.
Immigration investments: EB5 / E2 Visas
This type of US visa investment is for the foreign national who seeks to gain US residency or run their own US business.
For more info on the EB5 Visa Program and how it can work for you click this link.
For more info on the E2 Treaty Investor Visa, and whether this is the best route for you to reach America, click here.
At BAI we are always just one email away, no matter where you live. We can discuss your best options for wealth management and diversification in 2021.
Photo by Annie Spratt on Unsplash