search.noResults

search.searching

saml.title
dataCollection.invalidEmail
note.createNoteMessage

search.noResults

search.searching

orderForm.title

orderForm.productCode
orderForm.description
orderForm.quantity
orderForm.itemPrice
orderForm.price
orderForm.totalPrice
orderForm.deliveryDetails.billingAddress
orderForm.deliveryDetails.deliveryAddress
orderForm.noItems
REGIONSAMERICAS


INTERNATIONAL FOREIGN INVESTORS ARE CONCERNED ABOUT POLITICAL INSTABILITY IN THE US


USpoliticalrisk underscrutiny


US


Foreign investors have weighed the undoubted economic advan- tages of access to the US market against the risk that America’s apparent political stability might be a mirage following the turbulent ending of Donald Trump’s presidency. In a year that also sawdemon-


strations against racial inequality and police violence, as well as the disruption and fear caused by the unchecked spread of the Covid-19 virus throughout the nation, tension ran high. More than half the respondents


(51%) to an fDi poll identified “social unrest” as the biggest risk to President Biden’s America. More scientific analyses by risk consultan- cies, such as Eurasia Group and Verisk Maplecroft, confirmthat US instability is viewed as one of the top global risks in 2021. “Sadly, we’ve lost ground over the


past fewyears,” comments Jonathan Samford, senior vice president with the Washington DC-based Global Business Alliance, which represents international companies in the US. He cites the Trump administration’s “protectionist economic policies” and a fall in annual inbound foreign direct investment (FDI) between 2016 and 2019. Arun Pillai-Essex, senior analyst


for North America in Verisk Maplecroft’s NewYork office, says political and social polarisation will make it difficult to tackle big issues. The size of the US economy, its regu- latory environment, and domestic and capital markets remain attrac- tive, Mr Pillai-Essex notes. But he sees political polarisation as harmful to the business and macroeconomic environment. “That is the political risk: a government that is unable to make the country competitive glob- ally,” he warns. Furthermore, lack of long-termpredictability and volatil- ity in the policy landscape gives investors pause. “Investors seek stability, and


50 Civil unrest has dented investor confidence


their understanding of this is not just economic, but also political and rule-of-lawstability,” says David J Scheffer, a fellowat the Washington DC-based Council on Foreign Relations and former lawprofessor. He sees the Capitol insurrection as a challenge to the rule of law. “I would think that creates some astonish- ment that our systemof checks and balances did not work more effi- ciently. From an FDI perspective, there would be a natural hesitancy about howstable the US political systemand its legal structures are.” In contrast, a survey by The


Conference Board, a corporate think- tank, showed US chief executives’ concern about global instability plummeted from fourth place in 2020 to 10th for 2021. Ataman Ozyildirim, global research chair, says the survey was conducted after the US election, but before the Capitol insurrection. He believes the prospect of the Biden administration resolved many uncertainties for business who expected it to be more open to inter- national cooperation and focus on multinational organisations. “My sense is that global investors


and business leaders will think more about the long-termpotential of the US economy and probably give more weight to the overall economic and policy uncertainties than political instability,” he says.■ PHILIPPAMAISTER


Reshoring beats FDI inUSin 2020


In 2020, reshoring is expected to have created more US jobs than FDI for the first time in seven years, according to data collected by the Reshoring Initiative. The organisation forecasts in its


November 2020 report that US firms reshored nearly 69,000 manufactur- ing positions, while greenfield investment in the same industries created fewer than 42,000 roles. Aftermoving in tandemfor


much of the past decade, reshored jobs were up nearly 45% in 2020, and FDI jobs were down 40%. The report, which is based on job announce- ments and annualised data from the first half of 2020, supports early predictions that the pandemic is accelerating the trend of companies bringing overseas operations and supply chains back home. “A significant cause of the pick-up


in reshoring is Covid-19,” said the Reshoring Initiative’s founder and president Harry Moser, noting that the pandemic was a motivating factor in 60% of cases since March 2020. A June survey of 750 North American manufacturing firms found 69% were ‘likely’ or ‘extremely likely’ to reshore overseas operations.■ DANIELLEMYLES


FDI intoMexico falls by half


Foreign direct investment (FDI) flows into Mexico dropped substantially in 2020 due to pandemic, according to the latest data from investment tracker fDi Markets. Greenfield project numbers fell


by 45% on the previous year to 271, exceeding the 40.6% decline seen across the Latin America and the Caribbean region as a whole. Meanwhile, capital expenditure decreased even more sharply from $24.8bn to $13.2bn, owing to a reduction in the electricity generation sector. Foreign investments announced


in Mexico’s historically successful automotive components industry fell by over 75% to their lowest level since 2006, while FDI projects to the metals sector fell to a record low.■ SETHO’FARRELL


www.fDiIntelligence.com February/March 2021


60%


PROPORTIONOFUSRESHORING PROJECTSTHATCAMEABOUT DUETOCOVID-19


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80  |  Page 81  |  Page 82  |  Page 83  |  Page 84  |  Page 85  |  Page 86  |  Page 87  |  Page 88  |  Page 89  |  Page 90  |  Page 91  |  Page 92  |  Page 93  |  Page 94  |  Page 95  |  Page 96