CFG | 01-23-25 AM: A Record Surge in FDI

The United States has achieved a record share of global foreign direct investment (FDI), driven by strong consumer demand and government incentives. Announced greenfield projects in the U.S. rose from 11.6% in 2023 to 14.3% in the 12 months leading up to November 2024. This surge is attributed to robust productivity growth, the U.S.'s role as an AI innovation hub, lower energy costs, and investment incentives from the Inflation Reduction Act and Chips Act.

In contrast, China's and Europe's shares of inward FDI have decreased due to geopolitical tensions and high energy prices. The U.S. attracted over 2,100 new greenfield projects, compared to China's 400 and Germany's 470, with significant investments in semiconductors, industrial equipment, construction, electronic components, renewable energy, and aerospace. This trend underscores the U.S.'s growing appeal as a prime destination for global investments.

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The United States has consistently been one of the top recipients of foreign direct investment, reflecting its large consumer market and dynamic economy.