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Foreign Direct Investment Really Isn’t that ‘Foreign’ at All

Take a look around you. Whether you’re in transit, at work or at home, Foreign Direct Investment (FDI) is all around you.  For millions of Americans FDI also provides good-paying jobs.

The Bureau of Economic Analysis just released its latest FDI data, showing that foreign-headquartered firms invested $396 billion in 2016, breaking the previous record of $353 billion in 2015. A whopping 53 percent of that investment flowed into the U.S. manufacturing sector, supporting 2.4 million U.S. workers, or a fifth of all U.S. manufacturing jobs.

The rise in 2016 to a new level of FDIUS is remarkable, given that globally, foreign direct investment flows declined last year. According to preliminary data from the United Nations Conference on Trade and Development (UNCTAD), foreign investment worldwide dropped 13 percent, from $1.8 billion in 2015 to $1.5 billion in 2016.

Cumulatively, the United States remains the top choice for international investment, but its share of worldwide investment fell to 22 percent in 2015 (the most recent year available) from 37 percent in 2000, largely due to increased competition from other countries.  

When global companies invest in the United States, they bring more than just capital investment. They spur U.S. innovation. They support more jobs at local businesses through domestically-sourced supply chains. They bring world-class workforce training programs, equipping U.S. workers to compete in the 21st economy. They also bring jobs that build stronger communities. Through corporate support and employee engagement, these foreign-headquartered firms are building lasting connections in the communities in which they sustainably operate.
Learn more about the new 2016 data here.