Recent FDI Trends and DFAIT’s FDI Results

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Recent FDI Trends and DFAIT’s FDI Results. Presented by: David Hartman, Director Investor Services Division (DFAIT) C-11 Meeting, October 4. OBJECTIVE S. Despite a recent sharp drop in global investment flows, FDI remains the main engine of globalization. Average annual growth of - PowerPoint PPT Presentation

Text of Recent FDI Trends and DFAIT’s FDI Results

  • Recent FDI Trends and DFAITs FDI ResultsPresented by:David Hartman, Director Investor Services Division (DFAIT)C-11 Meeting, October 4

  • *OBJECTIVES

    Examine recent global FDI trends Review FDI trends in CanadaReport on highlights of DFAITs results for FY2010-11Present conclusions and discuss outlook

  • Despite a recent sharp drop in global investment flows,FDI remains the main engine of globalizationAverage annual growth of global commerce activities, (%) 1990-2010*Source: BIA compilations based on data from UNCTAD

    Chart1

    0.057

    0.084

    0.087

    0.129

    1980-2004

    Sheet1

    GDPExport - goodsExport -servicesFDI inflows

    1980-20045.70%8.40%8.70%12.90%

  • FDI Sources: Developed economies remain the main sources but emerging economies are becoming more importantCumulative FDI Outflowsby region (%) Asia and Oceania

    Latin AmericaEuropeNorth AmericaOthers

    2006-20101996-2000Cumulative FDI Outflows by countryTop 15 countries, 2006-2010Top Sources*Source: BIA compilations based on data from UNCTAD

    Chart1

    0.6522237950.20499618330.10628923190.0307182570.0057725328

    0.49595531110.22563630410.20113322170.04161245830.0356627047

    Europe

    North America

    Asia and Oceania

    Latin America and the Caribbean

    Others

    Sheet1

    Europe65%50%

    North America20%23%

    Asia and Oceania11%20%

    Latin America and the Caribbean3%4%

    Others1%4%

    Chart1

    0.0191534361

    0.0275558879

    0.0275918395

    0.0303241272

    0.0316983064

    0.0330616517

    0.0342725676

    0.0371602242

    0.03897448

    0.043502922

    0.047941745

    0.0688223945

    0.0720279667

    0.0772854346

    0.1925746524

    Change

    Sheet1

    SwedenRussiaChinaItalyNetherlandsCanadaSwitzerlandHong KongBelgiumSpainJapanGermanyUnited KingdomFranceUnited States

    Change0.01915343610.02755588790.02759183950.03032412720.03169830640.03306165170.03427256760.03716022420.038974480.0435029220.0479417450.06882239450.07202796670.07728543460.1925746524

  • *FDI Destinations: The shift of FDI inflows toward emerging economies continue with the BRICs as key destinationsCumulative FDI Inflowsby region (%) Asia and Oceania

    Latin AmericaEuropeNorth AmericaOthers

    2006-20101996-2000Cumulative FDI Inflows by countryTop 15 countries, 2006-2010Top DestinationsSource: BIA compilations based on data from UNCTAD

    Chart1

    0.4490.2690.160.10.02

    0.3610.1860.2580.1020.09

    Europe

    North America

    Asia and Oceania

    Latin America and the Caribbean

    Others

    Sheet1

    Europe45%36%

    North America27%19%

    Asia and Oceania16.00%25.80%

    Latin America and the Caribbean10%10%

    Others2%9%

    Chart1

    0.0195266635

    0.0204205137

    0.0214789535

    0.0227269049

    0.023861034

    0.0270512815

    0.0294273191

    0.0312231768

    0.0364128508

    0.0368570141

    0.0394690275

    0.0499201798

    0.0611763355

    0.0737762425

    0.1499677023

    Change

    Sheet1

    IndiaNetherlandsVirgin IslandsBrazilAustraliaSpainGermanyRussiaCanadaHong KongFranceBelgiumChinaUnited KingdomUnited States

    Change2.0%2.0%2.1%2.3%2.4%2.7%2.9%3.1%3.6%3.7%3.9%5.0%6.1%7.4%15.0%

  • *Over the last decades, there has been a significant shift toward FDI in servicesServices(54.3%)Manufacturing(41.2%)Primary(4.5%)Services(67.7%)Manufacturing(22.1%)Primary(10.3%)Share of global inward FDI flowsby major economic sectors (%)1990-19922007-2009Source: BIA compilations based on data from UNCTAD

    Chart1

    4.5

    41.2

    54.3

    FDI

    Sheet1

    PrimaryManufacturingServices

    FDI4.541.254.3

    Chart1

    10.3

    22.1

    67.7

    FDI

    Sheet1

    PrimaryManufacturingServices

    FDI10.322.167.7

  • *While FDI in Canada has grown in absolute terms, we have lost ground in relative terms over the last decadesNet FDI inflows in Canada Billion $CanCanadas share of global FDI inflows5 years moving averageActual flowsSource: BIA compilations based on data from UNCTAD and Statistics Canada

    Chart1

    8847

    3301

    5708

    6103

    11206

    12703

    13137

    15958

    33828

    36762

    99198

    42844

    34769

    10483

    -579

    31132

    68395

    123148

    61010

    21327

    22477

    FDI inflows (millions of dollars)

    Sheet1

    YEAR19901995200020052010

    FDI inflows (millions of dollars)8,8473,3015,7086,10311,20612,70313,13715,95833,82836,76299,19842,84434,76910,483-57931,13268,395123,14861,01021,32722,477

    123456789101112131415161718192021

    0

    -0.8268181375

    Chart1

    0

    0

    0

    0

    0

    0

    0

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    0

    0

    0

    0

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    Sheet1

    19701980199020002010

    share0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%

  • *Strong inflows in Canada over the recent period stems from large investments in the natural resources sector Distribution of cumulative FDI inflows in Canada by sectorsEnergy and metallicmineralsAll other sectors- 37%+ 37%Canada - 7th, (total FDI)Canada 21st, (Excluding FDI in Energy and metallic minerals)Top recipients of global FDI Inflows: Cumulative FDI inflows 2004-2010, US$ billionSource: BIA compilations based on data from UNCTAD and Statistics Canada

    Chart1

    0.240.76

    0.60800000020.392

    Resource

    Non-Resource

    Sheet1

    1992-20032004-2010

    Resource24%61%

    Non-Resource76%39%

    Chart1

    1381194

    793082.236504339

    598319

    457601.515069972

    417694.960396619

    347980.4676069

    302188.255150575

    265801.3054

    261062.662900619

    255522.206361436

    206808.254502373

    206064.020476579

    199689.699869539

    171875.981246242

    165371.432005304

    161911.651357828

    159016.67

    152356.066666667

    134955.858258145

    133117.066834751

    119989.178233244

    Sheet1

    United States1381194

    United Kingdom793082

    China598319

    Belgium457602

    France417695

    Hong Kong347980

    Canada302188

    Russia265801

    Germany261063

    Spain255522

    Netherlands206808

    Brazil206064

    Australia199690

    Virgin Islands171876

    Singapore165371

    India161912

    Mexico159017

    Saudi Arabia152356

    Italy134956

    Sweden133117

    Canada119989

  • While the U.S. and Europe still account for the majority of FDI stock in Canada, other countries are making important gains *Share of Top 10 source countries of Canadas Inward FDI stock in 2010 Total FDI Stock 2010: $561.6 billionUnited States (54.5%)Netherlands (9.2%)Switzerland (3.6%)UK (7.5%)France (3.4%)Japan (2.8%)China (2.5%)Brazil (2.4%)Luxembourg (2.0%)Germany (1.8%)Others (10.2%)Distribution of FDI stock, 2000 and 2010, by major regions, (%)Others EuropeUnited States Source: BIA compilations based on data from Statistics Canada

    Chart1

    54.5107333124

    9.2148371841

    7.510113672

    3.6243625538

    3.3887923421

    2.8480313951

    2.5027776986

    2.4027093245

    2.0222002222

    1.8133386513

    10.1621036438

    Column1

    Sheet1

    Column2Column1

    United States54.5107333124

    Netherlands9.2148371841

    United Kingdom7.510113672

    Switzerland3.6243625538

    France3.3887923421

    Japan2.8480313951

    China2.5027776986

    Brazil2.4027093245

    Luxembourg2.0222002222

    Germany1.8133386513

    Others10.1621036438

    To resize chart data range, drag lower right corner of range.

    Chart1

    0.6070.3350.058

    0.5450.3050.15

    1

    2

    3

    Sheet1

    20002010

    161%55%

    234%31%

    36%15%

    *

    *Trends in Foreign Investment Projects

    * *

    Total number of foreign investment projects globallySource: BIA compilations based on data from FDI Intelligence, Financial Times.Note: Estimated values on August 15, 2011, for all projects.Total value of foreign investment projects globally (US$ Billion)*Greenfield/expansion investment projects up globally but still below peak of 2008 After a sharp decline in 2009, the number of investment projects worldwide increased by 2% in 2010. Conversely, investment projects globally fell 16% in value terms in 2010.

    Chart1

    9533

    10391

    10721

    12500

    12507

    16595

    14347

    14650

    Global projects

    Sheet1

    Global projects

    20039533

    200410391

    200510721

    200612500

    200712507

    200816595

    200914347

    201014650

    Sheet2

    Chart1

    762.4

    712.7

    721.4

    884.4

    938.5

    1470

    965.6

    814.8

    Global value

    Sheet1

    Global value

    2003762.4

    2004712.7

    2005721.4

    2006884.4

    2007938.5

    20081470

    2009965.6

    2010814.8

    * *

    Total number of foreign investment projects in CanadaTotal value of foreign investment projects in Canada (US$ billion) Foreign investment projects in Canada rose by 20% in numerical terms and fell by 11% in value terms in 2010.Number of foreign investment projects in Canada has increased over previous yearSource: BIA compilations based on data from FDI Intelligence, Financial Times.Note: Estimated values on August 15, 2011, for all projects.

    Chart1

    23.3