Yahoo Finance 20 Countries that Receive the Most Foreign Direct Investment
In this article, we will look at 20 countries that receive the most foreign direct investment. If you want to skip our detailed analysis, you can go directly to the 5 Countries that Receive the Most Foreign Direct Investment.
An Analysis of the World’s Foreign Investment
The global investment landscape was gloomy in 2022, mainly due to the aftermath of the COVID-19 pandemic, rising inflation, turbulence in financial markets, and climate change causing investment uncertainty around the globe. Foreign Direct Investment (FDI) suffered due to economic volatility but remained more resilient than expected. According to IMF’s World Investment Report 2023, the global FDI amounted to $1.3 trillion in 2022 after declining 12 percentage points from the previous year. Despite the decline, investment inflows to the developing countries increased marginally; however, growth was concentrated in a few emerging economies. On the other hand, the FDI to the least developed countries declined, with FDI in 46 least developed countries falling to $22 billion after a decrease of 16%. Investors ended the year by announcing new industrial and infrastructural projects. To read more about investments, you can look at 12 Fastest Growing Sectors and Investment Opportunities in the US and 10 Best Investments During High Interest Rates.
The greenfield investment trends presented a bright spot for the international investment landscape, with the number of new projects increasing by 15% for 2022 and in the first fiscal quarter of 2023. The FDI and the number of new greenfield projects also increased in developing countries. The FDI in developing countries increased by 4%, reaching $916 billion. Meanwhile, the number of new greenfield project announcements witnessed a 37% increase, thereby signaling a positive indication for investment prospects in industry and infrastructure.
Moving forward, foreign direct investment is expected to increase modestly in 2024. On January 17, Reuters reported that the United Nations trade body was positive about global FDI rising modestly in 2024. According to the United Nations Conference on Trade and Development, the projections for inflation and the cost of borrowing in the major markets indicate stabilization to attract international investment deals, thereby increasing global FDI in 2024. The organization, however, stressed that the geopolitical risks and high debt levels in some countries could hinder the prospects of FDI. In 2023, the foreign direct investment amounted to approximately $1.37 trillion, a marginal increase of 3% from the previous year.
The Country that Attracts the Most FDI: The United States
The United States is one of the largest hosts of foreign direct investment and has announced several greenfield projects and international infrastructural and industrial deals. Some of the top companies in the US market that are driving economic growth include Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc. (NASDAQ:GOOG), and Apple Inc. (NASDAQ:AAPL).
Amazon.com, Inc. (NASDAQ:AMZN) is one of the leading multinational companies based in the United States. The company engages in various markets, including retail sales of consumer goods, subscription services, and advertising. Amazon.com, Inc. (NASDAQ:AMZN) operates through its physical and online stores throughout the globe. On February 1, Amazon.com, Inc. (NASDAQ:AMZN) reported strong earnings for the fiscal fourth quarter of 2023. The company reported earnings per share of $1.0 and outperformed EPS estimates by $0.20. The company's revenue for the quarter grew by 13.91% year-over-year and amounted to $169.96 billion, ahead of market consensus by $3.70 billion. Here are some comments from Amazon.com, Inc.’s (NASDAQ:AMZN) earnings call for Q4 2023:
These events also helped attract new customers and Prime members. Throughout the quarter customers saved nearly $10 billion across millions of deals and coupons almost 70% more than last year. In addition to offering great deals, we continue to improve delivery speeds. In 2023, Amazon delivered to Prime members at the fastest speeds ever, with more than 7 billion items arriving same or next day including more than 4 billion in the U.S and more than 2 billion in Europe. In the U.S this result is the combination of two things, one is the benefit of regionalization, where we’ve architected the network to store items closer to customers. The other is the expansion of same day facilities, where in the U.S in the fourth quarter, we increase the number of items delivered the same day or overnight by more than 65% year-over-year.
Alphabet Inc. (NASDAQ:GOOG) is another multinational technology company based in the United States. The company is renowned for its wide range of platforms, services, and products, including Google Cloud, Google Search engine, and Android. Alphabet Inc. (NASDAQ:GOOG) is a leading company that invests in technology and data infrastructure globally and has a business presence across America, Europe, and the Asia-Pacific. On January 30, Alphabet Inc (NASDAQ:GOOG) announced its earnings for the fiscal fourth quarter of 2023. The company reported an EPS of $1.64, and outperformed estimates by $0.04. The company’s revenue for the quarter amounted to $86.31 billion, up 13.49% year-over-year and ahead of market consensus by $1.03 billion. Here are some comments from Alphabet Inc.’s (NASDAQ:GOOG) earnings call for Q4 2023:
This infrastructure is also key to realizing our big AI ambitions. It’s a major differentiator for us. We continue to invest responsibly in our data centers and compute to support this new wave of growth in AI-powered services for us and for our customers. Through this, we are being disciplined in how we run the company. You’ve heard me talk about our efforts to durably reengineer our cost base and to improve our velocity and efficiency. That work continues. Teams are working to focus on key priorities and execute fast, removing layers and simplifying their organizational structures. As just one example, our devices team has brought together different teams from across Nest, Fitbit and other teams into a new functional structure. This will help us pull resources and drive progress across our Pixel portfolio.
Apple Inc. (NASDAQ:AAPL) is another leading global tech company that designs, manufactures, and markets personal computers, smartphones, and other wearable devices. Apple Inc. (NASDAQ:AAPL) invests in various international projects that foster technology infrastructure development. On March 13, Apple Inc. (NASDAQ:AAPL) announced welcoming manufacturing partners Taiwan Semiconductor Manufacturing Company Limited (TPE:2330) and Murata Manufacturing Company Limited (TYO:6981) to invest in the Restore Fund. Restore Fund is a global fund designed to scale the global investment in nature-based carbon removal without disrupting critical ecosystems. As per the deal, the Taiwan Semiconductor Manufacturing Company Limited (TPE:2330) will invest up to $50 million in a fund managed by Climate Asset Management. Additionally, Murata Manufacturing Company Limited (TYO:6981) will invest $30 million in the same fund.
With this context, let’s look at the 20 countries that receive the most foreign direct investment.
Our Methodology
To compile our list of 20 countries that receive the most foreign direct investment, we relied on foreign direct investment net inflows (BoP, current US$) figures from the World Bank. We took the latest available data, which was for 2022, and ranked the countries in ascending order of foreign direct investment, net inflows. In addition, we have also mentioned GDP figures (in current US$) for each country, sourced from the World Bank.
20 Countries that Receive the Most Foreign Direct Investment
20. Switzerland
Foreign Direct Investment, Net Inflows (2022) (current USD): $ 27.71 billion
Current GDP (2022): $818.43 billion
Switzerland is a Central European country that ranks 20th on our list of countries that receive the most foreign direct investment. Switzerland had a GDP of $818.43 billion in 2022 and received $27.71 billion as foreign direct investment in 2022.
19. Israel
Foreign Direct Investment, Net Inflows (2022) (current USD): $27.87 billion
Current GDP (2022): $525 billion
Israel ranks as the 19th country that receives the most foreign direct investment. It is a Middle Eastern country that received $27.87 billion as foreign direct investment in 2022. Moreover, the country had a GDP of $525 billion in 2022.
18. Italy
Foreign Direct Investment, Net Inflows (2022) (current USD): $31.23 billion
Current GDP (2022): $2.05 trillion
Italy is a European country along the coastline of the Mediterranean Sea. Italy makes it to the list of countries that receive the most foreign direct investment, with a total investment net inflow of $31.23 billion in 2022. Moreover, the country's GDP was $2.05 trillion during the same year.
17. Poland
Foreign Direct Investment, Net Inflows (2022) (current USD): $35.30 billion
Current GDP (2022): $688.13 billion
Poland, a Central European country ranks as the 17th country that receives the most foreign direct investment. The country received a total of $35.30 billion as foreign direct investment in 2022 and had a GDP of $688.13 billion in the same year.
16. British Virgin Islands
Foreign Direct Investment, Net Inflows (2022) (current USD): $38.12 billion
Current GDP (2022): N/A
The British Virgin Islands is an overseas British territory comprising 4 main and many smaller islands. It ranks as the 16th country that receives the most foreign direct investment and received $38.12 billion as foreign direct investment in 2022.
15. Mexico
Foreign Direct Investment, Net Inflows (2022) (current USD): $ 38.93 billion
Current GDP (2022): $1.47 trillion
Mexico is a North American country with a GDP of $1.47 trillion in 2022. It ranks 15th on our list of countries that receive the most foreign direct investment and received $38.93 billion as foreign direct investment in 2022.
14. Spain
Foreign Direct Investment, Net Inflows (2022) (current USD): $42.29 billion
Current GDP (2022): $1.42 trillion
Next is Spain, a European country with a GDP of $1.42 trillion, as of 2022. Spain ranks 14th on our list of countries that receive the most foreign direct investment and received $42.29 billion as foreign direct investment in 2022.
13. United Kingdom
Foreign Direct Investment, Net Inflows (2022) (current USD): $44.13 billion
Current GDP (2022): $3.09 trillion
The United Kingdom, comprised of England, Scotland, Wales, and Northern Ireland, ranks 13th on our list. The United Kingdom received a total of $44.13 billion as foreign direct investment in 2022 and had a GDP of $3.09 trillion in the same year.
12. Germany
Foreign Direct Investment, Net Inflows (2022) (current USD): $47.37 billion
Current GDP (2022): $4.08 trillion
Ranking 12th on our list of countries that receive the most foreign direct investment is Germany. Germany had a GDP of $4.08 trillion in 2022. The country attracts a lot of foreign direct investment, with the total investment received in 2022 amounting to $47.37 billion.
11. Japan
Foreign Direct Investment, Net Inflows (2022) (current USD): $ 47.52 billion
Current GDP (2022): $4.26 trillion
Japan, an East Asian country, ranks 11th on our list of countries that receive the most foreign direct investment. Japan had a GDP of $4.26 trillion in 2022 and received a total of $47.52 billion as foreign direct investment in 2022.
10. India
Foreign Direct Investment, Net Inflows (2022) (current USD): $49.94 billion
Current GDP (2022): $3.42 trillion
India makes it to the top 10 countries that receive the most foreign direct investment. It is a South Asian country that received a total of $49.94 billion in foreign direct investment in 2022. Moreover, the country had a GDP of $3.42 trillion during the same year.
9. Sweden
Foreign Direct Investment, Net Inflows (2022) (current USD): $50.05 billion
Current GDP (2022): $591.72 billion
Sweden is a Scandinavian country in Europe that ranks 9th on our list of countries that receive the most foreign direct investment. Sweden received a total of $50.05 billion as foreign direct investment in 2022.
8. Canada
Foreign Direct Investment, Net Inflows (2022) (current USD): $ 53.71 billion
Current GDP (2022): $2.16 trillion
Canada is a North American country that attracts a lot of foreign direct investment. It ranks as the 8th country that receives the most foreign direct investment on our list. The country received a total of $53.71 billion as foreign direct investment in 2022 and had a current GDP of $2.16 trillion during the same year.
7. Australia
Foreign Direct Investment, Net Inflows (2022) (current USD): $67.12 billion
Current GDP (2022): $1.69 trillion
Australia is one of the smallest continents and has one of the largest populations in the world. Australia received a total of $67.12 billion as foreign direct investment in 2022, making it the 7th country that receives the most foreign direct investment.
6. Brazil
Foreign Direct Investment, Net Inflows (2022) (current USD): $91.50 billion
Current GDP (2022): $1.92 trillion
Brazil is ranked 6th on our list, a South American country with a GDP of $1.92 trillion in 2022. The country attracts a lot of foreign direct investment and received a total of $91.50 billion as foreign direct investment in 2022.
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Disclosure: None. 20 Countries that Receive the Most Foreign Direct Investment is originally published on Insider Monkey.
