European FDI in the United States

April 19, 2017

Michael Jarand is an Investment Analyst in the International Trade Administration’s SelectUSA Program.

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Hannover Messe – the world’s leading industrial technology trade show – is quickly approaching and SelectUSA will be in attendance! As outlined by Jana Dorband in a previous blog post, Hannover Messe is a great opportunity to interact with thousands of potential investors.

In light of Europe’s longstanding role as a top investor in the United States, here are some highlights from Bureau of Economic Analysis (BEA) data on foreign direct investment (FDI) from the region.

European FDI is Large and Growing    



Table 1: European FDI in the U.S. (in billions of dollars)

The latest available 2015 BEA data show a continued strong investment relationship with European investment partners. European FDI totaled $1.92 trillion in 2015, accounting for 61.2 percent of total foreign investment into the United States. Despite the fact that Europe’s total share of FDI into the United States shrank from 63.4 percent to 61.2 percent — reflecting the growing role Asian markets play in global investment — European FDI was $375 billion higher in 2015 than 2011.

The five European countries with the most investment in the United States by ultimate beneficial owner (UBO) are the United Kingdom ($569 billion), Germany ($319 billion), France ($251 billion), Ireland ($200 billion), and Switzerland ($144 billion).

European Investment Greatly Benefits the US Economy



Table 2: European investment impact, 2014


In 2014, FDI from majority European-owned firms was responsible for 4.1 million direct jobs in the United States, about 65 percent of the total FDI-supported jobs. Like the FDI jobs previously discussed in this blog, these are high-impact jobs with an average annual compensation of $81,235.

Research and Development (R&D)

European firms are the largest foreign spender on research and development (R&D), enhancing U.S. global competitiveness. In 2014, U.S.-based affiliates of majority foreign-owned firms spent nearly $57 billion on R&D activities in the United States. Of this amount, $42 billion came from European firms, making up nearly 74 percent of the total.


Linkages between trade and investment also show up in European FDI. Exports of goods shipped by majority foreign-owned affiliates increased in 2014 to more than $425 billion. European firms made up $228 billion of this amount, almost 54 percent of the total.

European Multinationals Are Embracing Investment as an Alternative to Exporting

As outlined above, European investment is obviously beneficial to the U.S. economy – providing capital, high paying jobs, R&D spending, and exports. Investment is also beneficial for European firms, whose affiliate sales in the US make up a large part of their global portfolio. Increasingly, it appears that foreign direct investment and sales via affiliate companies is becoming the main mode of transatlantic business.

As shown in Figure 1, from 1999 to 2014, both U.S. imports of goods and services from the EU and sales of EU country-owned affiliates more than doubled. Imports of goods and services went from $270 billion to $595 billion, while EU country affiliate sales went from $947 billion to more than $2 trillion. If this trend continues, cross-border investment will continue to outpace traditional exports and imports.


Figure 1: EU Country Affiliate Sales and U.S. Imports of Goods and Services from EU

What’s Next?

Come visit us at Hannover Messe in the U.S. Investment Pavilion in Hall 3, from April 24 – 28th. We look forward to meeting you, and will be available for walkthroughs of SelectUSA client services and data tools!

This and other data are available in our SelectUSA Stats data visualization tool, including data by state and by industry. A national level overview of FDI data is available on the SelectUSA website along with updated country and state factsheets.

For more information on FDI data and SelectUSA services, please send an email to info@selectusa.gov.




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