Modulator

Foreign Investment in US Declines

The Progressive Policy Institute (related to New Democrats Online) sends out interesting stuff (irrespective of their politics) from time to time.

Their most recent Newsletter provides the following data on foreign investment in the US and worldwide(in billions):

It is not a surprise that both figures have declined. But note that foreign investment in the US has declined from about 20% to less then 6% of the world wide total. Here are PPI's suggested reasons:

(1) slow global growth and thus a smaller global FDI
pool;

(2) weak technology investment levels;

(3) falling confidence in long-term U.S. growth prospects, as perceptions of terrorist threats grow and structural budget deficits re-emerge after recent tax bills; and

(4) higher dollar values relative to the euro in 2001 and 2002, raising the price of acquisitions here.

You might come up with one or two more on your own.

Posted by Steve on June 26, 2003