According to the , produced by GlobalData and Investment Monitor, the number of greenfield (FDI) projects announced in dropped by 7.2% in 2021. This followed a 12.1% decline in FDI between 2019 and 2020. Regional FDI has yet to recover following the onset of and remains 18.5% lower than 2019 levels.
More than 80% of North America’s inbound FDI was into the in 2021. The country’s FDI levels fell for the second year in a row with a 20.1% drop between 2019 and 2020 followed by a 11% drop in 2021.
FDI fell by 21.3% between 2019 and 2020 but is showing signs of recovery. Project numbers grew by 13.7% in 2021, although FDI has yet to reach pre-pandemic levels.
Texas is North America’s top destination state
Despite a 9.5% decline in project numbers in 2021, overtook to become North America’s top destination state. Texas received 172 FDI projects during this time, accounting for 9.2% of the region’s overall inbound investment. Renewable and alternative power, and software and IT services were the state’s leading sectors with 27 projects each.
Major investments included South Korea-based Samsung’s planned $17bn semiconductor factory in . The multinational electronics company will create 2,000 new jobs at the plant, which will produce advanced logic chips to power next-generation devices for applications such as mobile, 5G, high-performance computing and . Construction will begin in early 2022 with production expected in the second half of 2024.
was North America’s second most popular state for inward investment. FDI project numbers increased by 3.1% between 2020 and 2021. Business and professional services was the state’s top sector for inbound FDI with 39 projects, a 50% increase compared to the previous year.
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By GlobalDataSeveral industries experienced an uptick in investment in 2021 including financial services, renewable and alternative power, electronics, and food. Software and IT services – which was previously New York’s top FDI sector, recorded a 46% decline in project numbers between 2020 and 2021.
California ranked third with 154 projects. The state previously came out on top for inward investment in 2019 and 2020 but suffered a 28% decline in project numbers between 2020 and 2021. California experienced the largest nominal decrease in investment of all states analysed with a 60-project drop.
placed fourth with 149 projects, making it Canada’s leading destination province. However, the region experienced a 2.6% decline compared to 2020. Of the top ten destination states, was the fastest growing location with a 21% increase in investment levels. The province also experienced the largest nominal FDI increase of all locations analysed, growing by 13 projects between 2020 and 2021.
Eight of the top ten destination states recorded a decline in project numbers between 2020 and 2021. While New York and Quebec experienced an increase in investment, both states are still below pre-pandemic levels.
The US accounts for 90% of outbound North American FDI
In terms of outbound investment, North American-based companies invested in 4,235 FDI projects in 2021, a 25.1% increase compared to 2020. However, outbound FDI levels have yet to exceed pre-pandemic levels and remain 2.6% below the project numbers recorded in 2019.
The US accounted for 90.1% of North America’s outbound FDI, with more than 3,800 projects. Despite a 26.9% increase in outbound US FDI between 2020 and 2021, investment levels were down 3.6% compared to 2019. Meanwhile, Canadian companies invested in 420 projects overseas in 2021, surpassing pre-pandemic levels by 7.7%.
Western Europe and Asia-Pacific are key source markets for North American FDI
In 2021, more than three-quarters of FDI into North America was from companies based in or the region. Western European businesses invested in 960 North American FDI projects in 2021, a 12.2% decrease compared to 2020. Asia-Pacific-based companies invested in 477 projects, up 14.9% from the previous year.
North American FDI from investors experienced the steepest drop of all regions analysed with project numbers falling by 51.2% between 2020 and 2021. Conversely, FDI from experienced the highest increase, growing by 71.4% between 2020 and 2021.
The was the top source country for North American FDI in 2019, 2020 and 2021. Approximately 15% of North American FDI projects in 2021 came from the UK with hospitality group and mining company among the top investors. was the leading country in the Asia-Pacific region with 113 projects.
US-based investment into Canada represented 9% of North American FDI. In contrast, Canadian investment into the US made up 7% of the region’s overall projects.
Four of the top ten source markets for North American investment increased their project numbers in 2021 – , , and . Australia-based investment more than doubled from 48 projects to 99, making it the fastest growing source country within the top ten.
Software is the top North American FDI sector
Software and IT services was North America’s leading FDI sector. Foreign companies created more than 300 projects in the region in 2021, with Toronto, New York City, Montreal and Austin among the key cities for tech investment.
Business and professional services ranked second, growing by 8.7% in 2021 compared to 2020. It was followed by the electronics sector which also saw an increase in project numbers (2.9%).
Healthcare, which ranked tenth, was the fastest growing sector in the region with investment levels surging by 260% between 2020 and 2021. North America was the top world region for healthcare investment worldwide during this period. Of the top ten sectors analysed, industrial machinery, equipment and tools suffered the largest decline with an almost 40% drop.
was North America’s top business function representing almost one-quarter of overall FDI. Approximately 20% of the projects recorded were sales, administration, and marketing operations and 15% were in business and professional services.
The number of healthcare provision projects more than tripled between 2020 and 2021, while training operations and logistics facilities contracted the most, falling by 30.8% and 30.3% respectively.
CSL is North America’s top inbound investor
Australia-based , a multinational specialty biotechnology company, created 46 projects in North America in 2021, making it the region’s top investor. This was a substantial increase from the 29 projects established in 2019. The company’s investments were primarily focused on the US with California and Texas the most popular destination states.
Belgium-based was the second largest investor. The company created 19 FDI projects in North America in 2021, the majority of which were manufacturing operations. These included its subsidiary Evergrain Ingredients’ $100m expansion of a sustainable ingredient production facility in St. Louis, Missouri. Anheuser-Busch InBev also created several expansion projects through its subsidiary Labatt Brewing across Canada.
US-based , which was the leading foreign investor globally, ranked third within the North American top 10 alongside Switzerland’s IWG and Japan’s . The company created 17 projects in Canada in 2021, the majority of which were logistics operations.
