Despite some negative headlines about declines in capital spending among corporations, year-end foreign direct investment (FDI) numbers for 2022 show there is strong interest in expansion within the United States, with Japan, Germany, Canada, the United Kingdom, Ireland, and France topping the list of investing countries.
Investing in the United States is attractive to international companies of all sizes for a number of different reasons:
- overall positive business climates
- availability of diverse workforce and higher education programs
- reasonable regulatory environments and business-friendly tax structures
- efficient freight options and solid transportation infrastructures
- access to a strong and robust consumer market
- strong concentration of industry clusters
For Some Companies, Solutions to Supply Chain Problems May Lay in the US
We’ve all read about supply chain disruptions brought on by global events including the COVID-19 pandemic (think lockdowns, labor shortages, and factory closures), Brexit, US tensions with China, and the Russia-Ukraine war, which created significant backlogs across several industries.
Camoin Associates’ engagement professionals speak daily with executives across the globe. Many of the decision makers we’ve spoken to who have plans to invest in the United States, either for the first time or to expand their US footprint, tell us they are doing so because of better proximity to their customers and to overcome current supply chain and logistics issues.
Source: https://www.morningstar.com/articles/1096095/where-does-the-supply-chain-crisis-stand-now
As companies figure out how to best address these issues, along with the ongoing demand for goods and services, it is likely that FDI in the United States will remain strong.
Continued increases in FDI announcements could also help communities struggling with workforce concerns. As expanding companies provide numbers and details on their labor needs, many of which will likely require specialized skills, this will help create more opportunities in higher education and technical skills, workforce training and certification programs.
Attracting Foreign Direct Investment to Your Community
International trade missions, targeted conferences, and communications that highlight regional advantages and incentives continue to be effective tools for attracting FDI. Economic development organizations that incorporate international prospecting strategies into their budget – like attending the SelectUSA Investment Summit – will be better positioned to identify companies that are looking to invest in the United States. Camoin Associates’ Lead Generation and Business Relationship Services Team can help. Contact us to learn more.
The SelectUSA Investment Summit is the top event in the United States for FDI promotion, connecting investors, companies, economic development organizations (EDOs), and industry experts to seize every opportunity available to make investment deals happen through US investment. The 2023 Summit returns to National Harbor, MD, from May 1-4, 2023.
Recent Examples of Foreign Direct Investment in the US
Here is a small sampling of some of the announcements we’ve seen so far in 2023 from international companies planning to locate or expand in the United States, many of which are first time Investments:
- Canada: IKO Industries, a roofing products manufacturer, is establishing its first South Carolina operations in Chester County.
- Finland:
- Kempower, a manufacturer of EV charging equipment, announced it would open its first US facility this year in Durham County, NC.
- Nokian Tyres, a global manufacturer of vehicle tires, announced it will double the production capacity of its eastern Tennessee plant. The company established its first US plant in Dayton, TN, in 2019.
- France: Tageos, a manufacturer of high-tech RFID inlays and tags, announced it will establish its North American headquarters and first manufacturing site in the US in Fletcher, NC.
- Hong Kong: ESPRIT, a clothing designer and manufacturer, will establish its Global Creative Headquarters in New York City, signaling the brand’s return to the US, where it was originally founded in 1968.
- Japan:
- Yanmar Compact Equipment, a global manufacturer of compact construction equipment, announced plans to expand its operations in northern Minnesota.
- SkyDrive Inc., an electric vertical take-off and landing aircraft manufacturer, has plans to enter the US market and establish its home base in South Carolina.
- Netherlands: ISO Group, a supplier of automation solutions in protected horticulture, announced their first US facility in the state of Virginia.
- Portugal/Brazil: MSS Steel Tubes, a manufacturer of steel tubing owned by Portuguese industrial company Metalogalva Group and Brazilian steelmaker Soufer Group, announced plans to establish its first US operations in Memphis, TN.
- South Korea:
- Sewon America, a subsidiary of Sewon Precision Industry Co., will establish a production facility in Rincon, GA.
- Samkee Corp., a manufacturer of aluminum automotive components, plans to establish its first US operations in Tuskegee, AL.
- Seoyon E-HWA, a global auto parts supplier that manufactures both interior and exterior components, will establish a new manufacturing facility in Chatham County, GA, it’s second in the state.
- Ecoplastic Corporation, a company that manufactures plastic automobile parts for original equipment manufacturers (OEMs) and other suppliers, will invest in a new manufacturing facility in Bulloch County, GA.
Additional Reading:
- “What in the World? FDI Trends to Watch in 2023,” AreaDevelopment.com
- “Amid Rebound, US Regains Position as World Leader in FDI,” AreaDevelopment.com
- “Why Foreign Investment in the US is Surging,” SiteSelection.com
- “Foreign Direct Investment in the United States, 2022,” Global Business Alliance
- “View from the Americas: US Growth Likely in 2023,” FDI Intelligence
- “5 Challenges Facing Global Supply Chains,” World Economic Forum
- “US Battery Gigafactories Investments Exceeds $40 Billion,” Thomasnet.com
- “Ford to Shift Product Development to US Amid ‘Structural Changes,'” Thomasnet.com
