Foreign investment in the United States plunged 32% in 2017

[GennGreymane]

https://money.cnn.com/2018/07/11/new...017/index.html

The amount of money coming into American companies from overseas fell 32% last year.
Foreign investors spent $259.6 billion to acquire, launch, and expand businesses in the United States in 2017, according to numbers released Wednesday by the US Bureau of Economic Analysis. That's down from an historic high of $439.5 billion in 2015.

The largest chunk of last year's foreign direct investment came from Canada ($66.2 billion), followed by the United Kingdom and Japan.

Foreign direct investment is influenced by a number of factors. A strong US dollar can make American assets more attractive. That may have partially driven a spike in foreign investment over the past two years.

Financial instability abroad also makes the United States' relatively safe markets seem like a good bet, although America's share of global foreign direct investment has declined over the years as developing countries have become more competitive.

The United States wasn't the only country to receive less money from outside its borders last year. According to the Organization for Economic Cooperation and Development, global foreign direct investment flows were down 18% in 2017 from the previous year and nearly 24% from its post-recession high in 2015, which the OECD attributed to a surge in financial and corporate restructuring.

Big businesses tend to support foreign investment in US companies, saying that the money supports expansion, research and development, and employment of U.S. residents.

The Trump administration has had a more mixed outlook.

President Donald Trump has celebrated foreign business activities in the United States, including the Chinese company Foxconn's construction of a factory in Wisconsin. But the White House also blocked Singaporean chipmaker Broadcom's acquisition of California-based Qualcomm, citing concerns that American technology could end up in the hands of China.

Trump has backed a bill pending in Congress that would expand the powers of the Committee on Foreign Investment in the United States, which reviews such transactions.

Trade adviser Peter Navarro, meanwhile, has characterized foreign investment as "conquest by purchase."

"In the long run, we are likely to be owned by foreigners," he said last year.

Nancy McLernon, president of a trade group of multinational companies called the Organization for International Investment, thinks that attitude — along with Brexit in the U.K. — took a toll on investment.

"Last year, there was a lot of uncertainty," McLernon says. "Multinational companies in general are concerned about how governments will be treating foreign companies operating in their countries. Cross-border acquisition is not surprisingly taking a hit from economic nationalism, not just in the U.S. but also worldwide"

[Lochton]

And with the Trump's newest ideas, it'll drop more I believe.

[Vankrys]

how about the counter-part, i mean american investment outside the US?

[Breccia]

They're busy buying all our debt. Foreign (esp. China) purchase of US debt skyrocketed in 2017.

Now, that's a mixed blessing. It means rates won't go up as much and, therefore, won't hurt the stock market as badly. But, yes, foreign investment money is finite, and they in 2017 were gambling that the US govt is more likely to repay and repay well than a US company. In case, say, the US company starts paying more for steel. Or sells less due to foreign tariffs. Or makes coal.

Trump's policies have made foreign investors more likely to invest in US than to invest in us.

[Rasulis]

Once again SV defy conventional wisdom. I was reading Fenwick & West “Silicon Valley Venture Capital Survey Fourth Quarter 2017,” and according to the survey 2017 was record breaking year for all stages of financing round (seed, first, second, later and restart) for both US and foreign raised venture capital funding.

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how about the counter-part, i mean american investment outside the US?

Well, Amazon bought Souq, Apple acquire Shazam and PowerbyProxi, Google bought HTC, and so on and so on.

[reliquit-salis]

fun fact about fdi. it surges and plummets regularly for every nation. and it is usually accompanied by an inverse in cross border capital. meaning when we take our entities to them they invest there as opposed to here. it will go back up. then it will go down. then it will go back up again. dont be worried.

[Heladys]

#winning.

All the best people, this administration.

[Deleted]

Politics aside, you'd think that eventually certain companies (like German car manufacturers) will invest more into factories and what not in the US to avoid tariffs.

[karumayu]

Politics aside, you'd think that eventually certain companies (like German car manufacturers) will invest more into factories and what not in the US to avoid tariffs.

Wouldn't manufacturing in US add to the cost for foreign companies as Trump is tariffing raw materials needed for manufacturing?

[Deja Thoris]

Politics aside, you'd think that eventually certain companies (like German car manufacturers) will invest more into factories and what not in the US to avoid tariffs.

Or they can just develop markets like Asia. Why bend over backwards to bend to Trump when markets like China value the prestige of say, an Audi or BMW.

[mvaliz]

Politics aside, you'd think that eventually certain companies (like German car manufacturers) will invest more into factories and what not in the US to avoid tariffs.

Somebody (you) clearly does not understand the concept of "return on investment".

It would probably take a couple decades to pay off a single factory built at this point, let alone turn a profit, if built in America - and right now people don't even know if America is going to be the same country 6 months from now - so why build in a completely unstable country?

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Or they can just develop markets like Asia. Why bend over backwards to bend to Trump when markets like China value the prestige of say, an Audi or BMW.

I mean, that's the thing people don't seem to understand... America is, probably, only about 1/4 of the world economy. You can sit there and say "Wahey! That's still a pretty huge chunk!" - but, probably due to American Insularity, they would be seeming to forget that 3/4 is greater that 1/4. >_<