The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
NEWS RELEASE EMBARGOED UNTIL RELEASE AT 8:30AM EDT, TUESDAY, JUNE 5, 2007 Lawrence McNeil: (202) 606-9860 BEA 07-23 Foreign Direct Investors’ Outlays to Acquire or Establish U.S. Businesses Increased in 2006 Outlays by foreign direct investors to acquire or to establish U.S. businesses were $161.5 billion in 2006, up substantially from $91.4 billion in 2005. Outlays in 2006 were the fourth largest recorded and the highest since 2000, when new investment outlays were at a historical peak of $335.6 billion. Outlays for New Investment in the United States by Foreign Direct Investors, 1980-2006 Billion $ 350 300 250 200 150 100 50 0 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005r 2006p p – Preliminary r – Revised This news release is available on BEA’s website at http://www.bea.gov/newsreleases/rels.htm. -more- -2Outlays increased substantially in manufacturing and finance (except depository institutions) and insurance. Together, these two sectors accounted for half of total investment outlays in 2006. Outlays were also sizable in several other sectors, including real estate and rental and leasing, information, depository institutions, and wholesale trade. Outlays from investors in most major geographic areas increased. By far the largest increase was attributable to European investors, whose outlays grew by $53 billion. Overall, outlays from Europe accounted for approximately two-thirds of the worldwide total. Investments from the Middle East, Asia and Pacific, and Latin America also rose considerably. Outlays from Canada declined further following a sharp decline in 2005. Outlays in 2006 In 2006, as in previous years, outlays by foreign direct investors to acquire existing U.S. businesses (at $147.8 billion) were significantly larger than outlays to establish new U.S. businesses (at $13.7 billion). Outlays made by, or through, existing U.S. affiliates of foreign investors were $110.6 billion, more than twice the $50.9 billion in outlays made directly by foreign investors. Outlays in manufacturing increased to $56.6 billion from $34.0 billion in 2005. The largest increases within manufacturing were in computers and electronic products (mostly for acquisitions of communications equipment manufacturers) and in chemicals (mostly for acquisitions of pharmaceuticals and medicines manufacturers). Outlays in finance (except depository institutions) and insurance increased sharply to $25.3 billion from $5.5 billion in 2005. Outlays in “other industries” more than doubled to $31.2 billion in 2006, the most sizable of which were in transportation and warehousing, mining, and health care and social assistance. By country of ultimate beneficial owner, outlays by European investors almost doubled, increasing to $109.9 billion from $56.4 billion in 2005. Outlays in manufacturing and the nonbank finance and insurance sectors fueled much of the growth. Expenditures by investors from Germany, France, Switzerland, and Spain grew substantially. German investment of $22.7 billion was the highest among individual countries, followed by British investment of $21.9 billion. Stepped-up investment from Japan and Australia contributed to a rise in overall investment from the Asia and Pacific region, while higher investment from Israel contributed to increased investment from the Middle East. The ultimate beneficial owner is the investor, proceeding up a U.S. affiliate’s ownership chain, beginning with the foreign parent, that is not owned more than 50 percent by another investor. The data on new investment outlays are classified by -more- -3country based on the location of the UBO; thus, they are shown against the country of the investor that ultimately owns or controls the affiliate, even though the investor may have channeled the funds for the investment though another country, such as a financial center. The estimates of outlays for 2006 are preliminary. The estimate of outlays for 2005 has been revised up 5 percent from the preliminary estimate published last year. Employment and assets of newly acquired or established businesses Newly acquired or established businesses employed 215,300 people in 2006, down 9 percent from 235,900 in 2005. The movement of employment and outlays in opposite directions occurred as new investments became more concentrated in industries with relatively low employment and relatively high acquisition values. Manufacturing accounted for the largest share of employment, with 91,400 employees. The total assets of newly acquired or established businesses were $356.5 billion, up considerably from $181.8 billion in 2005. * * * Estimates in this report are based upon a Bureau of Economic Analysis survey that covers (1) existing U.S. business enterprises in which foreign investors acquired, either directly or through their U.S. affiliates, at least a 10 percent ownership interest and (2) new U.S. business enterprises established by foreign investors or their U.S. affiliates, also using the 10 percent ownership interest threshold. Additional details on the new investments by foreign direct investors in 2006 will appear in the June issue of the Survey of Current Business, the monthly journal of the Bureau of Economic Analysis. * * * BEA’s national, international, regional, and industry estimates; the Survey of Current Business; and BEA news releases are available without charge on BEA’s website at www.bea.gov. By visiting the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements. -more- Table 1. Investment Outlays by Type of Investment and Investor, 1992-2006 [Millions of dollars] Total outlays By type of investment: U.S. businesses acquired U.S. businesses established By type of investor: Foreign direct investors U.S. affiliates 1992 15,333 1993 26,229 1994 45,626 1995 57,195 1996 79,929 1997 69,708 1998 215,256 1999 274,956 2000 335,629 2001 147,109 2002 54,519 2003 63,591 2004 86,219 2005r 91,390 2006p 161,533 10,616 4,718 21,761 4,468 38,753 6,873 47,179 10,016 68,733 11,196 60,733 8,974 182,357 32,899 265,127 9,829 322,703 12,926 138,091 9,017 43,442 11,077 50,212 13,379 72,738 13,481 73,997 17,393 147,827 13,706 4,058 11,275 6,720 19,509 13,628 31,999 11,927 45,268 32,230 47,699 13,899 55,809 120,828 94,428 120,878 154,078 105,151 230,478 23,134 123,975 13,650 40,869 27,866 35,725 34,184 52,035 40,304 51,086 50,906 110,627 p Preliminary r Revised Source: U.S. Bureau of Economic Analysis Table 2. Distribution of Investment Outlays by Size, 1992-2006 [Percent] Total outlays $5 billion or more $2 billion - $4.999 billion $100 million - $1.999 billion Less than $100 million 1992 100 0 0 42 58 1993 100 0 (D) 51 (D) 1994 100 0 27 51 22 1995 100 (D) 18 48 (D) p Preliminary r Revised D Suppressed to avoid disclosure of data of individual companies. Source: U.S. Bureau of Economic Analysis 1996 100 0 29 55 16 1997 100 0 12 67 21 1998 100 55 11 27 7 1999 100 55 16 24 5 2000 100 48 20 27 5 2001 100 30 22 40 9 2002 100 (D) 18 45 (D) 2003 100 (D) (D) 43 12 2004 100 (D) 13 47 (D) 2005r 100 0 28 59 13 2006p 100 19 23 54 4 Table 3. Investment Outlays by Industry of U.S. Business Enterprise, 2003-2006 [Millions of dollars] All industries 2003 63,591 2004 86,219 2005r 91,390 2006p 161,533 10,750 2,516 (D) (D) (D) (D) (D) 1,164 498 (D) 91 123 122 2,125 139 225 462 1,086 941 9,236 1,431 278 (D) (D) 4,864 23,511 2,817 1,955 8,429 18,251 2,146 (D) (D) 120 (D) (D) 4,751 84 153 (D) (D) 642 2,934 (D) 1,199 969 (D) 3,073 4,315 1,274 (D) (D) 2,783 (D) 26,234 6,335 (D) 10,121 34,036 1,646 (D) (D) (D) (D) 225 9,598 1,636 388 4,877 111 382 3,596 747 5,942 4,663 3,489 1,262 8,487 2,555 (D) (D) 2,085 7,973 5,529 8,756 6,407 15,453 56,582 683 1,366 4,387 226 (D) 0 14,783 (D) 1,012 2,448 952 1,629 17,950 2,222 1,446 7,047 8,002 1,158 9,503 3,834 (D) 4,680 (D) 9,270 25,347 15,669 4,821 31,181 Manufacturing Food Beverages and tobacco products Textiles, apparel, and leather products Paper Printing and related support activities Petroleum and coal products Chemicals Plastics and rubber products Nonmetallic mineral products Primary metals Fabricated metal products Machinery Computers and electronic products Electrical equipment, appliances, and components Transportation equipment Other Wholesale trade Retail trade Information Publishing industries Motion picture and sound recording industries Telecommunications Other Depository institutions Finance (except depository institutions) and insurance Real estate and rental and leasing Professional, scientific, and technical services Other industries p Preliminary r Revised D Suppressed to avoid disclosure of data of individual companies. Source: U.S. Bureau of Economic Analysis Table 4. Investment Outlays by Country of Ultimate Beneficial Owner, 2003-2006 [Millions of dollars] All countries Canada Europe France Germany Netherlands Switzerland United Kingdom Other Europe Latin America and Other Western Hemisphere South and Central America Other Western Hemisphere Africa Middle East Asia and Pacific Australia Japan Other Asia and Pacific United States 1 2003 63,591 2004 86,219 2005r 91,390 2006p 161,533 9,157 39,024 2,955 8,830 1,077 649 20,373 5,140 1,607 182 1,425 (D) 1,738 11,469 9,032 1,544 893 31,502 43,815 6,415 4,788 461 6,505 23,288 2,358 2,629 1,382 1,247 (D) 1,318 6,015 3,850 1,027 1,139 13,640 56,416 5,608 7,239 2,609 2,332 30,420 8,206 5,042 980 4,062 (D) 5,068 10,924 4,713 4,245 1,966 12,012 109,858 19,682 22,683 5,463 14,625 21,880 25,524 9,130 1,215 7,916 (D) 12,436 17,526 6,866 8,719 1,942 (D) (D) (D) (D) p Preliminary r Revised D Suppressed to avoid disclosure of data of individual companies. 1. The United States is the country of ultimate beneficial owner for businesses newly acquired or established by foreign investors that are ultimately owned by persons located in the United States. Note. For investments in which more than one investor participated, each investor and each investor's outlays are classified by the country of each individual ultimate beneficial owner. Source: U.S. Bureau of Economic Analysis Table 5. Selected Operating Data of U.S. Business Enterprises Acquired or Established, by Industry of U.S. Business Enterprise, 2005-2006 2005r All industries Manufacturing Wholesale trade Retail trade Information Depository institutions Finance (except depository institutions) and insurance Real estate and rental and leasing Professional, scientific, and technical services Other industries Millions of dollars Total Net assets income Sales 181,846 67,141 3,060 47,529 5,095 1,907 12,086 48,950 21,828 16,577 6,382 21,491 36,348 7,307 2,154 4,881 2,660 1,632 1,389 2,531 8,239 1,911 160 61 -103 348 232 161 -36 325 2006p Thousands of employees 235.9 Hectares of land 1 34,471 96.3 19.6 10.3 8.5 14.2 5.7 2.3 16.1 62.9 13,790 200 94 (D) 255 3 7,847 (D) 12,276 Millions of dollars Total Net assets income Sales 356,541 79,264 3,137 74,153 5,330 1,487 12,163 104,628 99,898 14,859 4,880 39,142 34,573 5,166 2,167 3,420 4,386 10,590 2,720 405 15,836 1,187 494 16 133 876 -570 79 -22 943 Thousands of employees 215.3 Hectares of land 1 1,389,995 91.4 10.9 6.3 11.7 18.4 12.9 0.9 2.4 60.3 9,692 10,718 (D) (D) 332 65 7,761 (D) 1,360,464 p Preliminary r Revised D Suppressed to avoid disclosure of data of individual companies. 1. One hectare equals 2.471 acres. Thus, for all industries, acres of land owned in 2005 were 85,178, and in 2006 were 3,434,678. Note. For newly acquired businesses, the data cover the most recent financial reporting year preceding acquisition. For newly established businesses, the data are projections for the first full year of operations. Source: U.S. Bureau of Economic Analysis
@FedFRASER