- Foreign direct investment in the United States (FDIUS) totaled $82.3 billion in the fourth quarter of 2024, an increase of 25 percent over the third quarter.
- Net equity flows registered $25 billion in the fourth quarter 2024, composing 30 percent of FDIUS.
- Reinvestment of earnings stood at $59 billion in the fourth quarter of 2024, accounting for some 70 percent of FDIUS.
- Foreign direct investment in the United States in 2024 totaled $308 billion, making it the fifth-strongest year for FDIUS over the past decade. FDIUS reached record highs in 2015 and 2016, at $484 billion and $480 billion, respectively.
- Quarterly FDIUS flows are subject to large revisions and can fluctuate greatly from quarter to quarter.
- Despite increased global competition for foreign investment dollars as more countries position themselves as open and attractive investment destinations, the United States remains a prime investment market attracting capital and businesses to the United States that create new jobs across the American economy, bolster American innovation, and enhance American’s global competitiveness.
Analysis & Context
Fourth quarter 2024 foreign direct investment flows in the United States totaled $82.3 billion, increasing 25 percent from third-quarter 2024. FDIUS flows registered $308 billion in 2024, an increase of seven percent over 2023, making it the fifth-strongest year of the past decade. Reinvested earnings in 2024 made up the largest portion of FDIUS at nearly three-quarters of total FDIUS.
In 2024, Japan, the United Kingdom, and Canada were the top investors in the United States, each investing around $40 billion. The Netherlands and Germany completed the list of the top five investors in FDIUS flows.
Manufacturing led in FDIUS flows in 2024 at $117 billion, followed by wholesale trade and finance at $53 billion and $25 billion, respectively. Transportation equipment was the largest manufacturing segment by FDIUS at $24 billion.
Globally, FDI flows apparently increased 11 percent between 2023 and 2024. But excluding European ‘conduit’ countries (Ireland, Luxembourg, the Netherlands, Switzerland, the United Kingdom because these countries’ FDI flows are greatly impacted by conduit flows), FDI flows were down by eight percent, according to the United Nations Conference on Trade and Development (UNCTAD). UNCTAD noted that worldwide FDI flows might increase modestly in 2025, despite continued challenges that could thwart global investment.
In its most recent Investment Trends Monitor, UNCTAD reported that the United States received three of the world’s 10 largest Greenfield investment announcements last year, all in the semiconductor industry.
Looking at foreign direct investment more broadly, international companies invest in the United States for many reasons. A list of positive factors includes the large U.S. market, world-class research universities, a stable regulatory regime, and a solid infrastructure that allows businesses to easily access the U.S. market. For certain international investors, the United States has become an important global export platform. Good domestic energy resources also draw international investors to the United States.
These investments benefit the American economy as international firms build new factories across the United States, buoy their well-established U.S. operations, fund American research and development activities, and employ 8.4 million Americans in well-paying jobs.
The United States remains the world’s prime location for international investment on a cumulative basis. Whether the United States will retain its status as the world’s most attractive investment location hinges on macroeconomic policy decisions, both in the United States and abroad.
The effects of the Trump Administration’s policies on FDIUS are difficult to predict. Its America First Investment Policy welcomes foreign investment and promises a stiffer review of Chinese investment. It is worth noting that Chinese investment in the United States has dropped in recent years and currently represents less than one percent of total foreign direct investment in the United States.