What are the trends in Foreign Direct Investment in 2016? Each year since 1998, consulting firm A.T. Kearney sends a survey to its corporate clients to track the impact of likely political, economic and regulatory changes on the foreign direct investment intentions of top business executives.
Since A.T. Kearney’s first Foreign Direct Investment Confidence Index, the rankings and the global FDI flows have matched, and countries ranked in the Index have received half of the global FDI inflows the following year, according to the consulting firm.
The 2015 Index shows developed markets leading the ranks, indicating that investors seek safer opportunities. Whilst global investment flows remain fairly steady, they still haven’t reached their pre-2009 peak.
Below are the top countries that corporations plan on investing in in 2016.
United States tops the Index for the third consecutive year, with over 40 percent of the polled business executives stating they are more optimistic about the U.S. economy’s outlook than they were one year ago.
Second in place is China, also for the third straight year. Most executives say their companies would increase investment in China if signs of a successful transition to a consumption-led economy emerge.
Following China is the U.K., which reached its highest position since 2002, as it was Europe’s top destination for investment in 2014.
Fourth in place is Canada, with low taxes and trade agreements making it a popular destination for foreign investment.
Germany comes in as number five, proving stability during the Eurozone crisis. Brazil is listed as number six, as South America’s only ranked country.
Japan entered the top 10 ranking for the first time in three years, rising to 7th from 19thin 2014, and 13th in 2013.
Also climbing up the rankings is France, landing an eighth place in 2015, as restrictions on investment activities have been eased.
Mexico and Australia are ranked ninth and tenth respectively in this year’s Index, with Australia attracting $50 billion in FDI inflows in 2014.
Note: A.T. Kearney is a Strategic Partner of the World Economic Forum.
Author: Jenny Soffel is Website Editor at the World Economic Forum
Image: A view from New York Harbor of the Lower Manhattan New York City skyline just after sunset May 19, 2015. REUTERS/Mike Segar
