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The US share of global cross-border investment projects has soared to its highest level on record, underscoring the country’s stronger economic momentum than Europe or China as Donald Trump starts his second term in the Oval Office.
The figures for announced greenfield projects — where companies build or expand new facilities and operations in a foreign country — come as political and business leaders gather in Davos to debate how the Trump presidency might reshape the global economic order through steep tariffs and reshored production.
The proportion of new FDI projects announced in the US rose from 11.6 per cent in 2023, to 14.3 per cent in the 12 months to November 2024, according to FT analysis of data collected by fDI Markets, an FT-owned company that has tracked cross-border investments from 2003.
The increase has been driven by buoyant consumer demand and government incentives in the world’s largest economy, according to economists.
“The US is pulling in more and more global investment projects and this reflects the strong demand outlook and much stronger productivity growth than elsewhere,” said Innes McFee, global economist at Oxford Economics.
“We expect that US exceptionalism to continue,” he said, adding that while the Trump policies are creating uncertainty, a looser budget would drive demand and “add to reasons for investing in the US in the short term. Protectionist policies might do the same”.
Trump will address the World Economic Forum in Davos on Thursday via video link, with delegates in the Swiss resort keen to hear his economic plans. The president did not immediately impose higher import levies in the executive orders he issued on the day of his inauguration.
The US attracted over 2,100 new FDI greenfield projects in the 12 months to last November. By contrast, China secured just under 400 projects in the same period, close to a historic low and a fraction of the 1,000 plus investments received each year in the decade up to the mid-2010s.
New projects in Germany plunged to 470 in the 12 months to November 2024, the lowest figure in 18 years in Europe’s largest economy and a big decline from 1,100 greenfield investments a year earlier.
Nathan Sheets, chief economist at US bank Citi, said the American surge was partly because of the country’s importance as a hub for AI innovation, lower energy costs and investment incentives as part of the Biden administration’s Inflation Reduction Act and the Chips Act.
Meanwhile, China’s share of inward FDI has fallen due to “geopolitics”, Sheets said, referring to the west’s attempts to “de-risk” from China.
Europe’s share has fallen even more sharply. Energy prices surged on the continent following Russia’s invasion of Ukraine in early 2022 and “cheap energy is attractive to investors”, said Sheets.
The estimated value of new greenfield FDI projects in the US announced in the 12 months to November 2024 rose by more than $100bn to $227bn, according to fDi. The data is based on corporate project announcements, press reports and fDI estimates for the lifetime of the project, rather than annual capital spending.
The rise in US greenfield investment is spread across several sectors. Record 12-month project totals were recorded for semiconductors — which have benefited from support from the Chips Act — and in industrial equipment, construction, electronic components, renewable energy and aerospace.
Growth in the US economy is forecast to continue outpacing other advanced nations, according to IMF figures released last week. The US is now expected to grow by 2.7 per cent in 2025, compared with an expansion of just 1 per cent in the Eurozone.
The shifting geopolitical landscape, with rising trade tensions between the US and China, is contributing to recent FDI trends as multinationals try to hedge supply chain risks.
“Global trade is more fragmented and securing supply chains becomes the name of the game,” said Samy Chaar, chief economist at Lombard Odier. “This means a trend towards friendshoring for goods you do not intend to produce and reshoring for strategic industries such as microchips and healthcare.”
Sixty-two per cent of FDI projects in the US last year were from western Europe, an increase from 58 per cent in the 10 years to 2019, the last year before the pandemic.
In contrast with the inward FDI surge, the number of overseas projects from the US shrank to 2,600 in the 12 months to November, the lowest in two decades excluding the height of the pandemic. The Biden administration’s industrial policies have incentivised US companies to keep production in the country, experts said.
While uncertainty over the Trump administration’s policies on trade and taxation has hung over big corporations since November’s election, economists do not expect his agenda to deter projects in the short term.
Trump’s election “doesn’t change the investment incentives and the economic picture” for investors, said Richard Bolwijn, head of investment research at UN trade body Unctad’s investment and enterprise division. “From that perspective, the attractiveness of the US for world investment will continue to go up.”
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