Business Facilities - April 2008 - (Page 7)

INVESTING AROUND THE WORLD In March, OCO Global, an authority on foreign investment, released its 2007 global foreign direct investment (FDI) guide. (For a partial ranking of this data, entitled Most Foreign Direct Investment Projects by Country, see chart at bottom right.) Further analysis of the guide offers insight into how countries fared in other categories like jobs created and dollars invested. Global FDI grew by 5.1% in 2007, creating 2.9 million new jobs. Over 100,000 of these jobs were in the United States, representing $46.8 billion in investment, a 20% increase from 2006. California, New York, Texas, Florida, and Pennsylvania drew the most foreign investment. Japan, Germany, and the UK were the top investors in the U.S., bringing in companies like Toyota, Tesco, Vodafone, and BAE Systems. China led both the AsiaPacific and world markets in 2007 by ranking first in number of total projects (1,171), new jobs (366,111), and investment ($90.4 billion). India lost the top spot to China in the jobs created category due to a 45% drop from its 2006 figures, but the subcontinent still attracted nearly 250,000 new jobs last year. Europe led the world with 5,384 total FDI deals in 2007, followed by the Asia-Pacific region with 3,402, and North America with 935. Latin America had 777 deals, while the Middle East landed 486 and Africa struck 380, a 16% drop from 2006. SNAPSHOTS SECONDS with Mark O’Connell, CEO of OCO Global M ark O’Connell is the CEO of OCO Global, a consulting firm he founded in 2001 that specializes in international investment and trade. O’Connell also oversees the operations of Mintel International Group in Ireland. BF: In 2007, the United States saw a 20% increase in FDI from 2006. Is this an unusually large increase and, if so, what factors do you think account for it? O’Connell: The United States currently offers a bargain to international investors; the weak dollar, combined with the slowdown in the U.S. economy, is creating a unique opportunity for foreign companies to establish a U.S. presence. Property is relatively cheap and investors can negotiate since it’s a buyer’s market. Skills are abundant since many U.S. firms are not hiring, and some in the financial services are shedding jobs, making labor costs more competitive. Economic development organizations in the worst-affected states will sell their grannies to get new jobs and investment, so big incentives are on the table. We expect 2008 to be another strong year for inbound FDI to the U.S. BF: California, New York, and Texas attract the most U.S. FDI. What other states can you identify as possible alternatives for foreign companies to consider? O’Connell: Arguably, some of these front runner states are over shopped and over heated from an FDI perspective. We are seeing shrewd investors look at overspill states like Arizona and Nevada, where you can still find skills and quality without paying California prices. Florida and Georgia also offer excellent gateways for investors to the wider Southeast U.S. and Latin America. Lastly, New York has some stiff competition in financial and business services from Pennsylvania, New Jersey, and New England, which offer lower costs with often better operating environments and skills. BF: What can states with smaller economies do to lure foreign investment? O’Connell: The best advice here is to specialize—choose one or two sectors or activities where you can shine and demonstrate competitive advantage to investors. Get to know those sectors and the business issues that need to be addressed. Then prepare your short list of active companies and build relationships directly with these companies and their advisors. FOREIGN DIRECT INVESTMENT PROJECTS BY COUNTRY, 2007 1. 2. 3. 4. 5. China (1,171) USA (783) India (676) UK (622) France (556) 6. Germany (432) 7. Spain (379) 8. Romania (364) 9. Russia (361) 10. Poland (330) 11. 12. 13. 14. 15. UAE (271) Vietnam (260) Singapore (239) Hungary (217) Mexico/Belgium (206) SOURCE: OCO GLOBAL LTD. BASED ON GREENFIELD FDI PROJECTS. BUSINESS FACILITIES 7

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Business Facilities - April 2008 Contents First Word Snapshots Corporate Moves: Ohio Businesses On the Move Corporate Moves: Nebraska If You Build It, They Will Come A Tale of Two Industries Economic Transformation In the Islands Diversity: A New York State of Mind Growing in the Sun Key Kansas Industries Get a Boost How To Choose the Right Commercial Real Estate Broker Missouri Downtowns Dare to Dream Advertiser Index Ask the Expert

Business Facilities - April 2008

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