GENEVA — Growing corporate profits and an improved global economic outlook helped the U.S. attract a surge of new foreign direct investment last year, at a time when investors were generally putting more of their money into the developing world.
The U.S. in 2004 received $121 billion in FDI, a fourfold increase from the $30 billion in 2003, according to a U.N. report released Tuesday. That helped the U.S. to retake the top spot as an investment destination, displacing China, which in 2003 ranked number one with inflows of $54 billion. The growth in the U.S. wasn’t enough to offset an overall decline in new investments in rich nations, in a year when FDI flows to the developing world were up markedly.
The report by the U.N. Conference on Trade and Development estimated inflows to developing countries totaled $255 billion, up 48 percent from the year before, and a historic high, with the Asia-Pacific region the most popular destination with $166 billion FDI, up 55 percent over 2003. Rich nations received inflows of $321 billion, a 16 percent fall from 2003.
China was the leading emerging-market destination with $62 billion, followed by Hong Kong with $33 billion, Singapore with $21 billion and South Korea with $9 billion, noted the report. India, the world’s second most populous nation with a lucrative and growing middle class market, attracted $6 billion, up from $3 billion a year earlier.
This story first appeared in the January 12, 2005 issue of WWD. Subscribe Today.