At first glance, it appears Donald Trump has been a boon for inbound foreign investment to the US. In the first three and a half years of his presidential term, fDi Markets recorded 6,167 greenfield project announcements in the US, up from 5784 projects during the corresponding period of Barack Obama’s second term. 

The total capital investment pledged by foreign investors in the US under the Trump administration stood at $156.4bn (including estimates). This was more than 60% higher than in Mr Obama’s second term and 71% higher than in George W Bush’s second term. 

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However, in terms of the estimated number of jobs created by these foreign investments, there were 1.2% fewer under Mr Trump than in Mr Obama’s second term. Despite Mr Trump’s claims of bringing back manufacturing jobs, fDi Markets data indicates that there were 3,500 fewer jobs created by foreign manufacturers in the US under Trump than in Mr Obama’s second term.

Leading sectors

Across all four presidencies, technology and business services FDI led in terms of project numbers, consistent with smaller capital expenditure requirements than other sectors.

Meanwhile, foreign investment into the US real estate sector has boomed under Mr Trump, with 261 greenfield projects — more than double the number during Mr Obama’s second term. This is perhaps an unsurprising trend, given the president’s background in the sector. In September 2019, Mr Trump vowed to protect foreign real estate investors when he set out to crack down on homelessness and deregulate the housing market.

Other notable sectors that have risen under Mr Trump include healthcare, biotechnology and pharmaceuticals, which saw the number of projects rise respectively by over 300%, 68% and 58% between Mr Obama’s second term and Mr Trump’s time in office. 

Didi Caldwell, the president of site selection consultancy Global Location Strategies, says that Mr Trump’s tax reforms made the US more competitive for projects in industries with “a high value and low cost product”, where the tax rate has a substantial effect on overall costs.

Trump also hoped to spur US companies to invest domestically by the removal of the tax disincentive for US companies to repatriate their foreign earnings. A Federal Reserve analysis of domestic investment by US firms after Mr Trump's Tax Cuts and Jobs Act in 2018 was inconclusive as to whether it was successful.

Sources of investment

UK investors were most active throughout all four presidential administrations, with the highest number of projects; German investors came in second. Despite Mr Trump’s hostility and trade war with China, the country’s investors have been increasingly committed to the US.

Chinese companies announced 281 projects during Mr Trump’s first three and a half years in office, a higher number than in both of Mr Obama’s terms and Mr Bush’s second term.

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Part of a six-part feature that first appeared in the October/November edition of fDi Intelligence. View a digital edition of the magazine here