New Data Shows Surge in U.S. Cross-Border Investments
During the start of his second term, President Trump, on January 21st, revealed data indicating that the United States’ share in global cross-border investment projects has soared to historic levels, demonstrating the country’s economic momentum surpassing that of Europe and China.
According to an analysis by the Financial Times of data collected from FDI Markets, the proportion of new foreign direct investment (FDI) projects announced in the U.S. from December 2023 to November 2024 accounted for 14.3% of all such investments globally, as compared to 11.6% in 2023.
These figures include new greenfield projects, which refer to projects started from scratch, such as building or expanding facilities and operations in a foreign country, offering significant development opportunities and innovation potential.
From December 2023 to November 2024, the U.S. attracted over 2,100 new foreign direct investment greenfield projects. Meanwhile, Germany’s new projects plummeted to 470 during this period, a significant drop from 1,100 a year prior, marking the lowest level in 18 years for the largest economy in Europe.
In the same timeframe, China only secured nearly 400 projects, nearing a historical low, whereas in the period around 2005 to 2015, China used to receive over 1,000 greenfield projects annually.
FDI data also reveals that the estimated value of greenfield projects in the U.S. from December 2023 to November 2024 increased by over $100 billion, reaching $227 billion. These estimates are based on corporate project announcements, news reports, and estimations of the project lifecycle by FDI, rather than yearly capital expenditures.
The growth in greenfield investments in the U.S. spans various industries including semiconductors, industrial equipment, construction, electronic components, renewable energy, and aerospace.
The policies adopted by the Biden administration to incentivize U.S. companies to keep production domestic have proven effective. From December 2023 to November 2024, the number of overseas investment projects by U.S. companies decreased to 2,600, marking the lowest level in 20 years (excluding the peak of the pandemic).
Economists believe that the significant growth in foreign direct investment in the U.S. is attributed to robust consumer demand and government stimulus measures.
Innes McFee, a global economist at the Oxford Economics Research Institute, stated: “The increasing number of global investment projects being attracted to the U.S. reflects strong demand prospects and productivity growth far exceeding other regions.”
He predicts that the uniqueness of the U.S. will persist, and while there may be uncertainty due to Trump’s policies, loose budgets will drive demand and “increase reasons for short-term investment within the U.S., protectionist policies may also have a similar effect.”
Nathan Sheets, Chief Economist at Citibank, believes the U.S. attracts foreign investment due to its status as an artificial intelligence innovation hub, lower energy costs, and the investment incentives implemented by the Biden administration.
He suggests that the decrease in China’s share of foreign investments is due to “geopolitics,” while the decline in Europe’s share is attributed to surging energy prices.