An official website of the United States government. 
Political Economy Protection and FDI
Publication Number
2021-05-C
Topic
FDI
Investment
Publication Topics
Author(s)
Jeremy E. J. Streatfeild
Abstract
Rising demand, failing infrastructure, and untapped potential for electricity generation in sub-Saharan Africa have created a substantial need for large-scale investment in the region. This paper identifies traditional providers of foreign and domestic investment in electricity generation in the region, discusses historical and recent trends, and assesses U.S. firms’ position in this market.
Author(s)
Wenkai Sun, Xiuke Yang, Gene Xiao
Abstract
This paper analyzes aggregate return to capital statistics for China, the United States, and Japan in order to investigate the causes of an unusually high investment rate and increasing foreign direct investment (FDI) inflows to China. We also analyze labor’s share of output and capital-output ratio statistics to predict future trends in the return to capital in China. Our findings allow us to come to four conclusions: (1) China’s high investment rate corresponds to a high return to capital in the country, just as high investment rates in the United States and Japan historically correspond to a high return to capital. (2) A comparatively higher return to capital attracted FDI to China. (3) Investment rates among these three countries show no signs of convergence so far. These differences will likely persist, encouraging FDI to continue to flow into China in near future. (4) The return to capital in China will likely decrease in the long run, as the experiences of Japan and the United States indicate, but will only decrease and become stable after a certain level of capital stock and development is reached.
Author(s)
Katherine Linton, Nicholas Corrado
Abstract
India has charted its own intellectual property (IP) path over the last 35 years, attempting to foster the growth of a domestic pharmaceutical industry and access to medicine while, more recently, also addressing the requirements of the international IP regime. Multinational companies (MNCs) have responded to India’s movement towards compliance with the WTO intellectual property agreement, TRIPS, by increasing the quantity and quality of foreign direct investment (FDI) in the areas of pharmaceutical research and development (R&D) and manufacturing. By contrast, MNCs have adopted a more cautious attitude toward the patenting and commercialization of new pharmaceutical products in India, waiting to see how Indian courts and patent offices interpret the new laws, and awaiting the enactment of long debated data protection legislation. The ultimate success of the Indian “calibrated approach” to fostering the domestic industry and access to medicine while also addressing international IP requirements remains to be seen.
Author(s)
Laura Bloodgood
Abstract
This article surveys trends in U.S. inbound and outbound foreign direct investment (FDI) during 2000-2005. The article examines the major country and regional destinations for U.S. direct investment abroad (USDIA), and foreign direct investment in the United States (FDIUS). After a brief survey of total inbound and outbound FDI, trends are examined by region and by the most significant developed and developing country investment partner countries. Throughout the paper, the analysis pays particular attention to the multinational corporations that are the source of most FDI, along with particularly important mergers, acquisitions, and greenfield investments. By far the largest U.S. FDI partner is Europe, particularly the United Kingdom, Germany, and the Netherlands. Canada ranks second in terms of its overall FDI relationship with the United States. One-third of cumulative USDIA, equal to $623 billion in 2005, is invested in holding companies in a small number of countries, primarily in Europe and the Caribbean, making it difficult to track the final country and industry destinations of this capital, and limiting an understanding of the effects of U.S. FDI. Mexico is by far the most important FDI partner country among developing countries, for both USDIA and FDIUS.