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Albania

Executive Summary

Albania is an upper middle-income country with a gross domestic product (GDP) per capita of USD 5,373 (2019 IMF estimate) and a population of approximately 2.9 million people. An estimated 45 percent of the population live in rural areas.  The IMF estimates Albania’s real GDP increased by 2.2 percent in 2019, and that GDP will contract by 5 percent in 2020 because of the November 2019 earthquake and the COVID-19 crisis. The IMF projects the economy will grow by 8 percent in 2021, provided COVID-19 restrictions ease by summer 2020. The rebound is expected to be fueled mostly by increased consumption and a large post-earthquake reconstruction program. During the post-earthquake International Donors Conference in February, international donors pledged close to USD 330 million in grants and approximately USD 940 million in soft loans.

Albania received EU candidate status in June 2014 and, in March 2020, the European Council endorsed the recommendation of the European Commission to open accession talks with Albania.  Prior to the first Intergovernmental Conference, which marks the start of accession negotiations, Albania must implement a number of reforms in the justice sector, adopt changes to its electoral code, advance efforts to support minority rights, reduce unfounded asylum claims in EU member states, and show tangible progress in its fight against organized crime and corruption.

The Albanian legal system ostensibly does not discriminate against foreign investors.  The U.S.-Albanian Bilateral Investment Treaty, which entered into force in 1998, ensures that U.S. investors receive national treatment and most-favored-nation treatment.  The Law on Foreign Investment outlines specific protections for foreign investors and allows 100 percent foreign ownership of companies in all but a few sectors. Albania has been able to attract increasing levels of foreign direct investment (FDI) in the last decade.

According to the Bank of Albania data, flow of FDI has averaged USD 1.1 billion in the last six years, and stock FDI reached USD 9.5 billion at the end of 2019. Investments are concentrated in the energy sector, extractive industries, banking and insurance, telecommunications, and real estate. Switzerland, The Netherlands, Canada, Turkey, Austria, and Greece are the largest sources of FDI.

To attract FDI and promote domestic investment, Albania approved a Law on Strategic Investments in 2015.  The law outlines investment incentives and offers fast-track administrative procedures to strategic foreign and domestic investors through December 31, 2020, depending on the size of the investment and number of jobs created. In 2015, to promote FDI, the government also passed legislation creating Technical Economic Development Areas (TEDAs), like free trade zones. (The government is a member of and an advocate for the Western Balkan Initiative, a regional zone intended to increase connectivity and commercial activity.) The development of the first TEDA has yet to begin after several failed tender attempts.

The government made significant advancements in its Digital Revolution Agenda during 2019. As of January 2020, 61 percent of all public services to citizens and businesses were available online through the E-Albania Portal, up from 15 percent in 2019. The reform is ongoing, and the government states that by December 2020, 91 percent of all public services will be available online. This should help curb corruption by limiting direct contacts with public administration officials.

Despite a sound legal framework and progress on e-reform, foreign investors perceive Albania as a difficult place to do business. They cite corruption, particularly in the judiciary, a lack of transparency in public procurement, and poor enforcement of contracts as continuing problems in Albania. Reports of corruption in government procurement are commonplace. The increasing use of public private partnership (3P) contracts has reduced opportunities for competition, including by foreign investors, in infrastructure and other sectors.  Poor cost-benefit analyses and a lack of technical expertise in drafting and monitoring 3P contracts are ongoing concerns. U.S. investors are challenged by corruption and the perpetuation of informal business practices. Several U.S. investors have faced contentious commercial disputes with both public and private entities, including some that went to international arbitration. In 2019 and 2020, a U.S. company’s attempted investment was allegedly thwarted by several judicial decisions and questionable actions of stakeholders involved in a dispute over the investment.

Property rights continue to be a challenge in Albania because clear title is difficult to obtain.  There have been instances of individuals allegedly manipulating the court system to obtain illegal land titles.  Overlapping property titles is a serious and common issue. The compensation process for land confiscated by the former communist regime continues to be cumbersome, inefficient, and inadequate. Nevertheless, parliament passed a law on registering property claims on April 16, which will provide some relief for title holders.

Transparency International’s 2019 Corruption Perceptions Index ranked Albania 106th of 180 countries, a drop of seven places from 2018.  Consequently, Albania and North Macedonia are now perceived as the most corrupt countries in the Western Balkans. Albania also fell 19 spots in the World Bank’s 2020 Doing Business survey, ranking 82nd from 63rd in 2019. Although this change can be partially attributed to the implementation of a new methodology, the country continues to score poorly in the areas of granting construction permits, paying taxes, enforcing contracts, registering property, obtaining electricity, and protecting minority investors.

To address endemic corruption, the Government of Albania (GoA) passed sweeping constitutional amendments to reform the country’s judicial system and improve the rule of law in 2016. The implementation of judicial reform is underway, including the vetting of judges and prosecutors for unexplained wealth.  More than half the judges and prosecutors who have undergone vetting have been dismissed for unexplained wealth or organized crime ties. The EU expects Albania to show progress on prosecuting judges and prosecutors whose vetting revealed possible criminal conduct. The implementation of judicial reform is ongoing, and its completion is expected to improve the investment climate in the country.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 106 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 82 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 83 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 N/A http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 USD 4,860 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $15,103 2018 $15,103 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $121 2018 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2018 N/A 2018 $0 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 59% 2018 52% UNCTAD data available at
https://unctad.org/en/Pages/
DIAE/World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

*Source for Host Country Data: Bank of Albania (http://www.bankofalbania.org/), Albanian Institute of Statistics (http://www.instat.gov.al/), Albanian Ministry of Finances (http://www.financa.gov.al/)

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data (2018)
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 7,833 100% Total Outward 563 100%
Switzerland 1,505 19% Kosovo 335 59.5%
Canada 1,139 14.5% Italy 165 29.3%
The Netherlands 1,105 14% United States 21 3.7%
Greece 903 11.5% North Macedonia 13 2.3%
Italy 617 7.9% Greece 8 1.4%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars) December 2018
Total Equity Securities Total Debt Securities
All Countries 846 100% All Countries 36 100% All Countries 810 100%
Turkey 187 22% Turkey 17 47% Turkey 170 21%
Germany 117 13.8% Canada 8 22% Germany 117 14%
Czech 99 11.7% The Netherlands 8 22% Czech 99 12%
France 72 8.5% The Bahamas 2 5.5% France 72 8.9X%
Italy 47 5.5% Country #5 Italy 47 5.8%

Algeria

Executive Summary

Algeria’s state enterprise-dominated economy is challenging for U.S. businesses, but multiple sectors offer opportunities for long-term growth.  The government is prioritizing investment in agriculture, information and communications technology, mining, hydrocarbons (both upstream and downstream), renewable energy, and healthcare.

The election of President Abdelmadjid Tebboune in December 2019 eliminated some of the uncertainty that marked the eight-month interim government which led the country following the April 2019 resignation of President Abdelaziz Bouteflika.  In response to continuing demands for political reform, Tebboune issued a draft of a new constitution in May 2020, and has proposed legislative elections before the end of the year.

In 2019, the government eliminated the so-called “51/49” restriction that required majority Algerian ownership of all new businesses.  The requirement will be retained for “strategic sectors,” identified as hydrocarbons, mining, defense, and pharmaceuticals manufacturing.  The government also passed a new hydrocarbons law, improving fiscal terms and contract flexibility in order to attract new international investors.  Following the enactment of this legislation, major international oil companies have signed memorandums of understanding with national hydrocarbons company Sonatrach.

Algeria’s economy is driven by hydrocarbons production.  Hydrocarbons account for 93 percent of export revenues and are the largest source of government income.  With the drop in oil prices in March 2020, the government calculated revenues would drop to roughly half of what the 2020 budget originally anticipated.  The government reduced investment by fifty percent in the energy sector, and investment in other sectors is likely to suffer large decreases and may only proceed if the historically debt-resistant government obtains foreign financing.  The government’s 2020 budget indicated such debt was possible, but officials have equivocated in public statements.  The government hopes to attract foreign direct investment (FDI) to boost employment and replace imports with local production.  Traditionally, Algeria has pursued protectionist policies to encourage the development of local industries.  The import substitution policies it employs tend to generate regulatory uncertainty, supply shortages, increased prices, and limited selection.

The government has taken measures to minimize the economic impact of the COVID-19 outbreak, including delaying tax payments for small businesses, extending credit and restructuring loan payments, and decreasing banks’ reserve requirements.

Economic operators deal with a range of challenges, including complicated customs procedures, cumbersome bureaucracy, difficulties in monetary transfers, and price competition from international rivals, particularly from China, Turkey, and France.  International firms that operate in Algeria complain that laws and regulations are constantly shifting and applied unevenly, raising commercial risk for foreign investors.  An ongoing anti-corruption campaign has increased wariness regarding large-scale investment projects.  Business contracts are subject to changing interpretation and revision of regulations, which has proved challenging to U.S. and international firms.  Other drawbacks include limited regional integration.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 106 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 157 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 113 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, stock positions) 2019 $2,749 https://apps.bea.gov/international/
factsheet//
World Bank GNI per capita 2019 USD 3,970 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $157.9 billion 2019 $170 billion World Bank:
https://data.worldbank.org/indicator/
NY.GDP.MKTP.CD
 
Algerian Office of National Statistics:
http://www.ons.dz/Au-deuxieme-
trimestre-2018-les.html
 
http://www.ons.dz/IMG/pdf/
comptesn4t2019.pdf
 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 $2.74 billion BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2017 Algeria not listed BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2019  18.3% of GDP Algerian Source: National Agency for Investment Development.

UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

* Source for Host Country Data: Algerian Office of National Statistics.

Data on inbound stock of FDI from UNCTAD is cumulative for 2005-2018, while the local Algerian source provides data only for 2018, hence the large discrepancy in size.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data 2018
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 26,693 100% Total Outward 2,302 100%
United States #1 6,962 26.08% Italy #1 1,010 43.87%
Italy #2 3,208 12.02% Peru #2 243 10.56%
France #3 2,939 11.01% Switzerland #3 234 10.17%
Spain #4 2,102 7.87% Spain #4 180 7.82%
United Kingdom#5 1,770 6.63% Libya #5 131 5.69%
“0” reflects amounts rounded to +/- USD 500,000.

The latest data available for Algeria is from 2018.

Table 4: Sources of Portfolio Investment
Data not available.

Andorra

Executive Summary

Andorra is an independent principality with a population of about 77,500 and area of 181 square miles situated between France and Spain in the Pyrenees mountains. Although not a member of the European Union, Andorra is part of the EU Customs Union and, due to a monetary agreement with the EU, uses the euro as its national currency. Andorra has become a popular tourist destination, accounting for about 80 percent of GDP, visited by over 8 million people each year who are drawn by its winter sports, summer climate, and duty-free shopping. Andorra has also become a wealthy international commercial center because of its integrated banking sector and low taxes. As part of its effort to modernize its economy, Andorra has opened to foreign investment, and engaged in other reforms, such as advancing tax initiatives aimed at supporting a broader infrastructure.

Andorra is actively seeking to attract foreign investment and to become a center for entrepreneurs, talent, innovation, and knowledge. In doing so, Andorra has fostered a large project with the Massachusetts Institute of Technology (MIT) on innovation and big data, employing Andorra’s unique economy as a test market.

The Andorran economy is undergoing a process of diversification centered largely on tourism, trade, property, and finance.  To provide incentives for growth and diversification in the economy, the Government began sweeping economic reforms in 2006. The Parliament approved three main regulations to complement the first phase of economic openness:  the law of Companies (October 2007), the Law of Business Accounting (December 2007), and the Law of Foreign Investment (April 2008 and June 2012). From 2011 to 2017, the Parliament approved direct taxes in the form of a corporate tax, tax on economic activities, tax on income of non-residents, tax on capital gains, savings taxation, and personal income tax. These regulations aim to establish a transparent, modern, and internationally comparable regulatory framework.

These reforms aim to attract investment and businesses that have the potential to boost Andorra’s economic development and diversification. Prior to 2008, Andorra limited foreign investment, worried that large foreign firms would have an oversized impact on its small economy.  For example, previous regulations allowed non-citizens with less than 20 years residence in Andorra to own no more than 33 percent of a company. While foreigners may now own 100 percent of a trading enterprise or a holding company, the Government must approve the establishment of any private enterprise. The approval can take up to one month, which can be rejected if the proposal is found to threaten the environment, the public order, or the general interests of the principality.

Andorra has per capita income above the European average and above the level of its neighbors, Spain and France. The country has developed a sophisticated infrastructure including a one-of-a-kind micro-fiber-optic network for the entire country that provides universal access to all households and companies. Andorra’s retail tradition is well known around Europe, thanks to more than 2,900 shops, the quality of their products, and competitive prices. Products taken out of the Principality are tax-free up to certain limits; the purchaser must declare those that exceed the allowance.

Table 1
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 N/A http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report “Ease of Doing Business” 2019 N/A http://www.doingbusiness.org/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country (M USD, stock positions) 2019 N/A https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2019 N/A http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Due to foreign investment limitations up until 2012, FDI statistics are too negligible to be available through the U.S. Bureau of Economic Analysis. However, Andorra’s Investment Promotion Agency, ACTUA, has compiled available data on foreign direct investment at: http://www.actua.ad/en/foreign-direct-investment-data-andorra.
Table 3: Sources and Destination of FDI
No data available.
Table 4: Sources of Portfolio Investment
Data not available.

Angola

Executive Summary

Angola is a lower middle-income country located in southern Africa with a USD 100 billion gross domestic product (GDP), a 31.9 million population and a per capita income of USD 3,360 according to 2019 International Monetary Fund (IMF) estimates. The third largest economy in sub-Saharan Africa, Angola is a member of the Organization of the Petroleum Exporting Countries (OPEC) and produces an average of 1.390 million barrels per day, the second highest volume in the sub-Saharan region behind Nigeria. Angola also holds significant proven gas reserves as well as extensive mineral resources. Oil still accounts for 90 percent of exports and 37 percent of GDP. The Government of Angola (GRA)’s commitment to improve oil sector transparency led to the creation of the National Oil and Gas Agency (ANPG), an independent regulator to manage oil and gas concessions, which also ensures that the state-owned oil monopoly Sonangol will relinquish substantial control in the sector and on its core upstream business. In addition to reforms in the oil sector, the administration of President Joao Lourenco has implemented numerous other structural reforms to improve macroeconomic stability and the climate for economic growth. In early 2018, the government scrapped the Angolan currency’s fixed peg to the U.S. dollar over concerns of dwindling foreign exchange reserves, and to institute a more transparent market-based foreign exchange regime. A new private investment law and an antitrust law in 2018 have been key administration initiatives to encourage foreign direct investment (FDI), private-sector competitiveness, and growth. The loosening of the exchange rate has since led to a 178 percent drop in the kwanza. Public debt has shot up to above100 percent of GDP. To curb the depletion of foreign currency reserves, the Central Bank (BNA) has allowed commercial banks to purchase foreign currency directly from oil and gas companies. The BNA has also adopted a restrictive monetary policy, increased the minimum share and start-up requirements for commercial banks, and revoked the licenses of two non-complaint commercial banks.

The Lourenco administration has prioritized the fight against corruption and the culture of impunity. His government has indicted prominent Angolan figures accused of corruption-related charges and has improved the legal framework to better control illicit financial flows. The National Strategic Plan to Fight Against Corruption, a five-year strategy launched in 2018, aims to tackle corruption, money laundering, and other economic and financial crimes. The strategy focuses on three main pillars – prevention, prosecution, and institutional capacity building, and includes short and long-term initiatives for a-whole-of society approach to help reduce the impact of corruption. In late 2018, the government approved the law on Compulsory Repatriation and Excess Loss of Assets, providing measures for the repatriation of illicit financial flows. However, a lack of institutional, human, and material capacity risks undercutting the government’s anti-corruption objectives.

The business environment remains challenging, spurred by a tedious bureaucracy with limited bottom-up leadership. Angola ranked 177 out of 190 in the 2020 World Bank’s Doing Business ranking. Inadequate supply chain infrastructure, slow and inefficient institutions, limited access to credit, and corruption continue to constrain the private sector’s contribution to growth. Progress in economic diversification and advancement in social and human-capital indicators remain slow and limited.

Angola remains heavily dependent on oil, which accounts for 90% of the nation’s total merchandise exports. The recent decline in international oil prices has further aggravated the vulnerability of the country to external shocks. Overdependence on a single export item (oil) has also discouraged the country from incorporating into global value chains and participating more fully in the export of manufactured goods and value-added services.

Rolling back dependency on oil will require significant investment in other economic sectors to stimulate growth. Opportunities lie in the precious minerals, tourism, agriculture, fisheries, and hydropower sectors. Continued infrastructure development opportunities are most obvious in the areas of public transportation, tourism, port rehabilitation, energy and power, telecoms, mining, natural gas, and in creating national oil refining capacity. Key sectors that have attracted significant regional and international investment in the country include energy, construction, and oil and gas. Non-oil economic sectors such as agriculture, energy, fisheries, and extractives will open up new areas to foreign and national investment. As the country continues to seek to diversify its economy, an emerging sector is agriculture, in which the country lacks technical knowhow and the necessary startup capital resources to develop. Agriculture represents only 11 percent of GDP. Angola has decided to open up its telecoms market in a bid to attract foreign capital.

Key Issues to watch:

  • Angola continues to suffer from a relatively poor investment climate due in large part to the lack of openness to competition in the private sector and the dominance of the state on state-owned enterprises and in the economy. However, the government has prioritized the privatization of 74 state-owned enterprises by 2020.
  • Angola benefits from a relatively stable and predictable political environment, especially when compared to its neighbors in the region. While Angola is scheduled to hold its first municipal elections in 2020, which may lead to some decentralization of decision-making authority, disbursement, and management of public resources, it is unlikely the elections will occur due to the ongoing COVID-19 pandemic.
  • There is an abundant supply of unskilled labor, particularly in the capital, Luanda. Skilled professionals are available, but often require additional training.
  • Portuguese is commonly spoken, while English competency levels are relatively low.
  • The new private investment law of 2018 provides greater tax incentives to companies investing in the domestic economy and does away with the local partnership requirements for foreign investment and ends minimum levels for investment.
  • The Government remains committed to improving the investment environment, strengthening governance, and fighting corruption, and in 2019 passed amended anti-money laundering and countering the financing of terrorism (AML/CFT) legislation to better control illicit financial flows and fight against corruption.
  • Real estate and living expenses remain expensive but have recently moderated due to the ongoing economic crisis, and the local currency weakening against the U.S. dollar. In 2019, Luanda ranked 26th as the most expensive city for expatriates globally, down from sixth in 2018.
  • Infrastructure is limited, roads are often in poor condition, power outages are common, and water availability can be unreliable. Although the government is attempting to ensure more transparency and has improved in its corruption ratings, the investment climate remains hampered by corruption, and a complex, opaque regulatory environment, as outlined in Table 1.
  • Despite price gains in crude oil benchmarks in 2019, weak global oil demand affected the Angolan economy, creating drastic losses in export revenue and a severe limitation in foreign exchange, forcing substantial cuts in government spending. Angola’s high external imbalances and forex shortages continue to hurt private sector growth, and its declining foreign currency reserves.

Repatriation of capital, dividends, and transfers of remittances abroad remain challenging.

Portfolio investment in Angola is embryonic.

Women empowerment:

Although only 23 percent of Angola’s entrepreneurs are women, Angola boasts one of the highest growth rates of female entrepreneurs in Africa. However, the government has not instituted any significant reforms to increase the percentage of female entrepreneurs and limited access to credit remains a significant impediment to entrepreneurship in general.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 146 of 180 https://www.transparency.org/cpi2019
World Bank’s Doing Business Report 2019 177 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 Not listed of 129 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 USD 267 Million https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 USD 3360 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $100 billion www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 $207 billion BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 $254.3 billion BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2017 9.9% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Antigua and Barbuda

Executive Summary

Antigua and Barbuda is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). According to Eastern Caribbean Central Bank (ECCB), as of December 31, 2019, Antigua and Barbuda had an estimated Gross Domestic Product (GDP) in market prices of $1.72 billion in 2019, with forecast growth of 6.75 percent in 2020. The economy of Antigua and Barbuda remained buoyant, driven mainly by increased tourist arrivals and ongoing public and commercial construction projects. However, due to the coronavirus pandemic, these projections have been revised downwards significantly, with expected declines in revenues and increased spending on imports such as medicine, medical equipment, and food. The government has stated it remains committed to improving the business climate to attract more foreign investment and stimulate growth.

In the World Bank’s 2020 Doing Business Report, Antigua and Barbuda ranks 113th out of 190 countries rated. The scores remained relatively unchanged from the previous year, but highlighted some improvements in starting a business.

The government strongly encourages foreign direct investment (FDI), particularly in industries that create jobs and earn foreign exchange. Through the Antigua and Barbuda Investment Authority (ABIA), the government facilitates and supports FDI in the country and maintains an open dialogue with current and potential investors. All potential investors are afforded the same level of business facilitation services.

While the government welcomes all FDI, tourism and related services, manufacturing, agriculture and fisheries, information and communication technologies, business process outsourcing, financial services, health and wellness services, creative industries, education, yachting and marine services, real estate, and renewable energy have been identified by the government as priority investment areas.

There are no limits on foreign control of investment and ownership in Antigua and Barbuda. Foreign investors may hold up to 100 percent of an investment.

Antigua and Barbuda’s legal system is based on British common law. There is currently an unresolved dispute regarding expropriation of an American-owned property. For this reason, the U.S. government recommends continued caution when investing in real estate in Antigua and Barbuda.

In 2017, the government signed an intergovernmental agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Antigua and Barbuda to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 Not ranked http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 113 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 Not ranked https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 7.0 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 15,890 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Please note that the following tables include FDI statistics from three different sources, and therefore will not be identical. Table 2 uses U.S. Department of Economic Affairs (BEA) data when available, which measures the stock of FDI by the market value of the investment in the year the investment was made (often referred to as historical value). This approach tends to undervalue the present value of FDI stock because it does not account for inflation. BEA data is not available for all countries, particularly if only a few U.S. firms have direct investments in a country. In such cases, Table 2 uses other sources that typically measure FDI stock in current value (or historical values adjusted for inflation). Even when Table 2 uses BEA data, Table 3 uses the IMF’s Coordinated Direct Investment Survey (CDIS) to determine the top five sources of FDI in the country. The CDIS measures FDI stock in current value, which means that if the United States is one of the top five sources of inward investment, U.S. FDI into the country will be listed in this table. That value will come from the CDIS and therefore will not match the BEA data.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 1,727 2018 1,611 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 7 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 3 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 59.6% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: Eastern Caribbean Central Bank https://www.eccb-centralbank.org/statistics/dashboard-datas/ . All ECCB GDP figures for 2019 are estimates.

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Argentina

Executive Summary

Argentina presents investment and trade opportunities, particularly in infrastructure, health, agriculture, information technology, energy, and mining; however, soaring debt and a failure to implement critical structural reforms have prevented the country from maximizing its  economic potential, though the country has taken steps to diminish bureaucratic procedures. Market reactions to the 2019 Argentine presidential elections deepened the country’s economic crisis, stalling reform efforts and leading to a rollback of some market-driven growth policies and the imposition of capital and export controls.  In late 2019, the government reprofiled some of the country’s local law debt payments. Argentina’s economy contracted for the second year in a row in 2019, as unemployment and poverty grew and annual inflation rose to 53.8 percent.

Following a victory in the October 2019 general election, President Alberto Fernandez took office on December 10, 2019. His economic agenda at the beginning of 2020 focused on restructuring the country’s sovereign debt and providing support to vulnerable sectors. The Fernandez administration increased taxes on foreign trade, further tightened capital controls, and pulled back from former President Mauricio Macri’s fiscal austerity measures, expanding fiscal expenditures. Citing a need to preserve Argentina’s diminishing foreign exchange reserves and raise government revenues for social programs, the Fernandez administration passed a sweeping “economic emergency” law that included a 30 percent tax on purchases of foreign currency and all individual expenses incurred abroad, whether in person or online.

The country began a nationwide quarantine on March 20 to combat the COVID-19 pandemic, shortly after the first case was confirmed on March 3. As of early May, the government anticipated a 6.5 percent drop in real Gross Domestic Product (GDP) growth for 2020, though the full economic  impact will largely depend on how long quarantine restrictions last and whether the government reaches agreement with its private bondholders to avoid a sovereign default. The Argentine government issued a series of economic relief measures to mitigate the economic impact of the quarantine, primarily focusing on informal workers that account for approximately 40 percent of the labor force. The government’s self-declared insolvency has sharply limited its access to credit, obligating it to finance the pandemic-related stimulus measures by monetary issuance, which may hamper its efforts to restrain inflation and maintain a stable exchange rate. As a result of the crisis, industry and unions are analyzing changes to labor agreements and requesting government tax reforms.  U.S. companies frequently point to a high and unpredictable tax burden and rigid labor laws, which make responding to changing macroeconomic conditions more difficult, as obstacles to further investment in Argentina.  In April, the government reprofiled foreign currency local law debt.  In early May, the Minister of Economy announced the government has sought to restructure its debt to private creditors by May 22 and to reschedule its Paris Club debt.  The Minister also stated the government intends to seek a new program with the International Monetary Fund (IMF), to which it owes $44 billion from a Standby arrangement the government signed in 2018.

In 2019, Argentina fell two places in the Competitiveness Ranking of the World Economic Forum (WEF), which measures how productively a country uses its available resources, to 83 out of 141 countries, and 12 out of the 20 countries in the Latin American and Caribbean region.  As a MERCOSUR member, Argentina signed a free trade and investment agreement with the EU in June 2019. Argentina has not ratified the agreement yet. In May, Argentina proposed slowing the pace and adjusting the negotiating parameters of MERCOSUR’s ongoing trade liberalization talks with South Korea, Canada, and other partners to help protect vulnerable populations and account for the impact of the ongoing COVID-19 pandemic.  Argentina ratified the WTO Trade Facilitation Agreement on January 22, 2018. Argentina and the United States continue to expand bilateral commercial and economic cooperation, specifically through the Trade and Investment Framework Agreement (TIFA), the Commercial Dialogue, and under the Growth in the Americas initiative, in order to improve and facilitate public-private ties and communication on trade, investment, energy, and infrastructure issues, including market access and intellectual property rights. More than 300 U.S. companies operate in Argentina, and the United States continues to be the top investor in Argentina with more than USD $15 billion (stock) of foreign direct investment as of 2018.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 66 of 183 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 126 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 73 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 15,196 https://www.bea.gov/data/
economic-accounts/international/
World Bank GNI per capita 2018 12,390 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $432,241 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $15,196 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $901 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 14% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 72,572 100% Total Outward 28,686 100%
United States 20,906 29% Uruguay 15,894 55%
Spain 11,954 16% United States 6,209 22%
The Netherlands 6.805 9% Mexico 1,405 5%
Brazil 4,059 6% Brazil 1,113 4%
Uruguay 3,916 5% Chile 754 3%
“0” reflects amounts rounded to +/- USD 500,000.

Table 4: Sources of Portfolio Investment
Data not available.

Armenia

Executive Summary

Over the past several years, Armenia has received respectable rankings in international indices that review country business environments and investment climates. Significant U.S. investments are present in Armenia, most notably ContourGlobal’s acquisition of the Vorotan Hydroelectric Cascade and Lydian International’s efforts to develop a major gold mine. U.S. investors in the banking, energy, pharmaceutical, information technology, and mining sectors, among others, have entered or acquired assets in Armenia. Armenia presents a variety of opportunities for investors, and the country’s legal framework and government policy aim to attract investment, but the investment climate is not without challenges. Obstacles include Armenia’s small market size, relative geographic isolation due to closed borders with Turkey and Azerbaijan, weaknesses in the rule of law and judiciary, and a legacy of corruption. Net foreign direct investment inflows are low. Armenia is a member of the Eurasian Economic Union, a customs union that brings Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia together in an integrated single market. In May 2015, Armenia signed a Trade and Investment Framework Agreement with the United States. The TIFA establishes a United States-Armenia Council on Trade and Investment to discuss bilateral trade and investment and related issues. In November 2017, Armenia signed a Comprehensive and Enhanced Partnership Agreement with the European Union, which aims in part to improve Armenia’s investment climate and business environment.

Armenia imposes few restrictions on foreign control and rights to private ownership and establishment. There are no restrictions on the rights of foreign nationals to acquire, establish, or dispose of business interests in Armenia. Business registration procedures are straightforward. According to foreign companies, otherwise sound regulations, policies, and laws are sometimes undermined by problems such as the lack of independence, capacity, or professionalism in key institutions, most critically the judiciary. Armenia does not limit the conversion and transfer of money or the repatriation of capital and earnings. The banking system in Armenia is sound and well-regulated, but investors note that the financial sector is not highly developed. The U.S.-Armenia Bilateral Investment Treaty provides U.S. investors with a variety of protections. Although Armenian legislation offers protection for intellectual property rights, enforcement efforts and recourse through the courts require improvement.

Armenia experienced a dramatic change of government in April/May 2018. Parliamentary elections in December 2018 led to the exit from power of numerous parliamentarians known to have significant business holdings in Armenia and exercise outsized sway over large sections of the economy. An anti-corruption campaign is underway as part of efforts to eliminate systemic corruption. Overall, the competitive environment in Armenia is improving, but several businesses have reported that broader reforms across judicial, tax, customs, health, education, military, and law enforcement institutions will be necessary to shore up these gains. Despite progress in the fight against corruption and improvements in some areas that raise Armenia’s attractiveness as an investment destination, investors claim that numerous concerns remain and must be addressed to ensure a transparent, fair, and predictable business climate. An investment dispute in the country’s mining sector has attracted significant international attention and remains outstanding after several years.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 77 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 47 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 64 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 USD 7 million http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 USD 4,230 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $13,649 2018 $12,433 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $228 2018 $7 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $3 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 44% 2018 44% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

Source for Host Country Data: Statistical Committee of the Republic of Armenia

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 5,072 100% Total Outward 232 100%
Russia 1,735 34.2% Georgia 59 25.4%
United Kingdom 433 8.5% Latvia 56 24.1%
Jersey 372 7.3% Bulgaria 36 15.5%
North Macedonia 334 6.6% United States 3 1.3%
Cyprus 303 6.0% N/A N/A N/A
“0” reflects amounts rounded to +/- USD 500,000.

Source:  IMF Coordinated Direct Investment Survey (CDIS) (2018)
A significant portion of outward investment is not specified by destination in the CDIS.

Table 4: Sources of Portfolio Investment
Data not available.

Australia

Executive Summary

Australia is generally welcoming to foreign investment, which is widely considered to be an essential contributor to Australia’s economic growth and productivity.  The United States is by far the largest source of foreign direct investment (FDI) for Australia.  According to the U.S. Bureau of Economic Analysis, the stock of U.S. FDI totaled USD 163 billion in January 2019.

Mining and resources attract, by far, the largest share of FDI from the United States.  Real estate investment is the second largest recipient of FDI from the United States, although it remains much smaller than mining investment in absolute terms.  The Australia-United States Free Trade Agreement, which entered into force in 2005, establishes higher thresholds for screening U.S. investment for most classes of direct investment.

While welcoming toward FDI, Australia does apply a “national interest” test to qualifying investment through its Foreign Investment Review Board screening process.  Various changes to Australia’s foreign investment rules, primarily aimed at strengthening national security, have been made in recent years.  The Security of Critical Infrastructure Act 2018 and  the related Telecommunications Sector Security Reforms were both introduced in 2018 with the aim of increasing the security of critical infrastructure and protecting against foreign investments deemed to not be in Australia’s interests.  In March 2020 the Australian government announced all foreign direct investment would be reviewed for a six-month period, the government’s assumed timing for the COVID-19 crisis.  Despite the increased focus on foreign investment screening, the rejection rate for proposed investments has remained low and there have been no cases of investment from the United States having been rejected in recent years.

In response to a perceived lack of fairness, the Australian government tightened anti-tax avoidance legislation targeting multi-national corporations with operations in multiple tax jurisdictions.  While some laws have been complementary to international efforts to address tax avoidance schemes and the use of low-tax countries or tax havens, Australia has also gone further than the international community in some areas.

Australia has a strong legal system grounded in procedural fairness, judicial precedent, and the independence of the judiciary.  Property rights are well established and enforceable.  The establishment of government regulations typically requires consultation with impacted stakeholders and requires approval by a central regulatory oversight body before progressing to the legislative phase.  Anti-bribery and anti-corruption laws exist, and Australia performs well in measures of transparency.  Australia’s business environment is generally conducive to foreign companies operating in the country, and the country ranks 14th overall in the World Bank’s Ease of Doing Business Index.

The Australian government is strongly focused on boosting economic productivity, particularly through increased use of digital and other emerging technologies.  It recently released a Digital Economy Strategy, a Blockchain Roadmap, and a Critical Minerals Strategy, and has launched the new Australian Space Agency, among other initiatives.  U.S. involvement and investment in these fields is welcomed.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 12 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 14 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 22 of 129 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country (historical stock positions) 2018 USD 163 billion https://apps.bea.gov/international/
factsheet
World Bank GNI per capita 2018 USD 53,230 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) 2019 USD 1.18 trillion 2018 USD 1.43 trillion www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country (stock positions) 2018 USD 133 billion 2018 USD 163 billion https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States (stock positions) 2018 USD 75 billion 2018 USD 66 billion https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 51% 2018 48% https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

*Australian Bureau of Statistics, based on most recently available data.  Year-end foreign investment data is published in May of the following year.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 682,865 100% Total Outward 490,986 100%
USA 151,247 22% USA 85,161 22%
Japan 74,743 11% UK 83,749 14%
UK 69,696 10% New Zealand 39,808 11%
Netherlands 34,769 6% Canada 23,866 3%
China 28,306 5% Papua New Guinea 17,248 3%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 808,049 100% All Countries 503,254 100% All Countries 290,608 100%
United States 331,582 42% United States 237,697 47% United States 93,886 32%
United Kingdom 68,034 9% United Kingdom 37,575 7% United Kingdom 30,460 10%
Japan 40,307 5% Japan 24,267 5% Germany 20,360 7%
Cayman Islands 40,425 5% France 19,287 4% Japan 16,040 6%
Canada 30,068 4% Switzerland 10,085 2% Netherlands 12,930 4%

Austria

Executive Summary

Austria offers a stable and attractive climate for foreign investors, including a well-developed market economy that welcomes foreign direct investment, particularly in technology and R&D. The most popular investment destinations in recent years have been the automotive, pharmaceuticals, and financial sectors.   The country benefits from a skilled labor force, and a high standard of living, with its capital Vienna consistently placing at the top of global quality-of-life rankings.

With more than 50 percent of its GDP derived from exports, Austria’s economy is closely tied to other EU economies; Germany is its largest trading partner, followed by the United States.  The economy features a large service sector and an advanced industrial sector specialized in high-quality component parts, especially for vehicles.  The country’s location between Western European industrialized nations and growth markets in Central, Eastern, and Southeastern Europe (CESEE) has led to a high degree of economic, social, and political integration with fellow European Union (EU) member states and the CESEE.

In October 2019 a new digital services tax was signed into law, effective on January 1, 2020.    This 5% tax on advertising revenues targets companies with global revenues exceeding €750 million ($848 million) and revenues within Austria of at least 25 million euros, with a carve-out for Austria’s national broadcaster (ORF), which would otherwise be taxed.

Austria also maintains a relatively high overall tax burden and a complex regulatory system with extensive bureaucracy.

Some 300 U.S. companies have investments in Austria, many of whom have expanded over time.  U.S. Foreign Direct Investment into Austria totaled approximately EUR 10.5 billion (USD 11.8 billion) at the end of 2019, according to the Austrian National Bank, and U.S. companies support over 17,000 jobs in Austria.

Following solid GDP growth of 1.6% in 2019, leading forecasters anticipate a 7-7.1% decrease in 2020 GDP due to COVID-19.  The economy is predicted to make a strong recovery in 2021, ranging from 4.3-5.6% GDP growth.

Austria’s government took quick, decisive measures to combat the spread of COVID-19, closing much of the retail sector and mandating a strict stay-at-home policy on March 16, 2020. As a result of their success in reducing infection rates, Austria was one of the first western countries to reopen their economy in stages starting April 14, 2020.   Because the country is highly dependent on both foreign trade and tourism, recovery will ultimately depend on the impact of the virus on global travel, international supply chains, and economic recovery in Austria’s largest export markets.

Austria offers a wide array of investment incentives to attract industry and jobs in high-tech, R&D, and economically disadvantaged regions.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 12 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 27 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 21 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($B USD, historical stock positions) 2019 USD 8.58 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 USD 49,310 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $446,345 2018 $455,286 https://data.worldbank.org/country/
austria?view=chart
 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($B USD, stock positions) 2019 $11.81 2018 $8.58 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($B USD, stock positions) 2019 $14.02 2018 $12.64 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2019 $45.9 2018 45.7% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
  

* Source for Host Country Data:
*Statistics Austria (GDP) https://www.statistik.at/web_de/statistiken/wirtschaft/volkswirtschaftliche_gesamtrechnungen/index.html 
*Austrian National Bank (Investments) https://www.oenb.at/en/Statistics/Standardized-Tables/external-sector/foreign-direct-investment.html 

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 246,083 100% Total Outward 280,254 100%
Germany 58,170 24% Germany 34,852 12%
Netherlands 32,269 13% Netherlands 33,556 12%
Russia 26,508 11% Luxembourg 15,546 6%
Luxembourg 22,447 9% Country #4 14,773 5%
United Arab Emirates 11,884 5% Country #5 13,458 5%
“0” reflects amounts rounded to +/- USD 500,000.

Austria’s inward investment figures show significant lower numbers for the Netherlands and Luxembourg. Special Purpose Entities (SPEs) may be used to avoid corporate taxes.

 Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 358,953 100% All Countries 147,308 100% All Countries 211,644 100%
Luxembourg 61,627 17% Luxembourg 52,919 36% Germany 25,594 12%
Germany 53,733 15% Germany 28,139 19% France 23,991 11%
United States 33,260 9% Ireland 16,270 11% United States 17,167 8%
France 30,787 9% United States 16,094 11% Netherlands 15,679 7%
Ireland 21,851 6% France 6,797 5% Spain 15,172 7%

Azerbaijan

Executive Summary

The overall investment climate in Azerbaijan continues to improve, although significant challenges remain.  Over the past few years, Azerbaijan’s government has sought to attract foreign investment, undertake reforms to diversify its economy, and stimulate private sector-led growth.  However, the Azerbaijani economy remains heavily dependent on oil and gas output, which account for roughly 90 percent of export revenue and over half of the state budget.  Real GDP grew 2.2 percent in 2019, primarily due to a ramp up in natural gas exports.  While the oil and gas sector has historically attracted the largest amount of foreign investment, the Azerbaijani government has targeted four non-oil sectors to diversify the economy: agriculture, tourism, information and communications technology (ICT), and transportation.  Measures taken in recent years to improve the business climate and reform the overall economy include eliminating redundant business license categories, empowering the popular “ASAN” government service centers with licensing authority, simplifying customs procedures, suspending certain business inspections, and reforming the tax regime.

Azerbaijan fell from 25th to 34th among 190 countries in the “Doing Business 2020” rating published by the World Bank and the International Finance Corporation.  According to the report published on October 24, Azerbaijan carried out four successful reforms from May 2018 to May 2019, thereby fulfilling four out of five goals.  These reforms were related to registering property, obtaining credit, protecting minority investors, and enforcing contracts.  Due to these indicators, Azerbaijan was featured as one of the top 20 “reformer” countries.  However, progress remains slow on structural reforms required to create a diversified and competitive private sector, and corruption remains a major challenge for firms operating in Azerbaijan.  A small group of government-connected holding companies dominate the economy, enforcement of intellectual property rights is insufficient, and judicial transparency is lacking.

Under Azerbaijani law, foreign investments enjoy complete and unreserved legal protection and may not be nationalized or appropriated, except under specific circumstances.  Private entities may freely establish, acquire, and dispose of interests in business enterprises.  Foreign citizens, organizations, and enterprises may lease, but not own, land.  Azerbaijan’s government has not shown any pattern of discriminating against U.S. persons or entities through illegal expropriation.  The Bilateral Investment Treaty (BIT) between the United States and Azerbaijan provides U.S. investors with recourse to settle investment disputes using the International Center for the Settlement of Investment Disputes (ICSID).  The average time needed to resolve international business disputes through domestic courts or alternative dispute resolution varies widely.

Azerbaijan considers travel to the region of Nagorno-Karabakh and the surrounding territories unlawful.  Engaging in any commercial activities in Nagorno-Karabakh and the surrounding territories, whether directly or through business subsidiaries, can result in criminal prosecution and/or other legal action against individuals and/or businesses in Azerbaijan; it may also affect the ability to travel to Azerbaijan in the future.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2018 152 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 25 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2018 82 of 126 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, stock positions) 2018 N/A http://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 $4,050 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $46,939 2017 $40,748 https://data.worldbank.org/
country/azerbaijan
 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) No reliable data BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) No reliable data BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP No reliable data 2017 76.6% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

* Source for Host Country Data:  Azerbaijan State Statistical Committee

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $29,314 100% Total Outward $20,461 100%
United Kingdom $6,317 22% Turkey $10,761 53%
Turkey $5,797 20% Georgia $2,984 15%
Norway $3,063 10% Switzerland $1,237 6%
Iran $2,523 9% United Kingdom $1,013 5%
Cyprus $1,907 7% United States $594 3%
“0” reflects amounts rounded to +/- USD 500,000.

Table 4: Sources of Portfolio Investment
Data not available.

Bahamas, The

Executive Summary

The Commonwealth of The Bahamas is a 100,000 square mile archipelago in the Atlantic Ocean just 50 miles from Florida’s east coast. The country maintains a stable environment for investment with a long tradition of parliamentary democracy, respect for the rule of law, and a well-developed legal system. U.S. companies find that The Bahamas’ proximity to the United States, common English language, and exposure to U.S. media and culture contribute to Bahamian consumers having general familiarity with, and positive attitudes towards, U.S. goods and services. The Bahamas is a high-income developed country with a Gross Domestic Product (GDP) per capita of $32,218 (2018) that conducts more than 85 percent of its international trade with the United States. The Free National Movement (FNM) government, elected in May 2017, has sought to manage an economy dealing with the dual, unprecedented economic crises wrought by the passage of Hurricane Dorian in September 2019 and the effects of the global COVID-19 pandemic, projected to inflict combined losses of $7.5 billion or 60 percent of GDP. According to Standard & Poors April 2020 forecasts, The Bahamas’ GDP growth is expected to fall by an unprecedented 16 percent in 2020 due to COVID-19. Full economic recovery is not anticipated until 2022, subject primarily to the buoyancy of the tourism sector and post-pandemic global economic recovery. Both the International Monetary Fund (IMF) and the Inter-American Development Bank (IDB) predict The Bahamas could suffer the most severe economic contraction of all Caribbean countries.

Tourism is the country’s largest sector, and economic growth is mainly driven by the industry and related services. With few natural resources and a limited industrial sector, the Bahamian economy is heavily dependent on tourism and, to a lesser degree, financial services. These sectors have traditionally attracted the majority of foreign direct investment (FDI). Tourism contributes over 50 percent of the country’s GDP and employs just over half of the workforce. The Bahamas relies primarily on imports from the United States to satisfy its fuel and food needs for local and tourist consumption. More than seven million tourists, mostly American, visit the country annually. U. S. exports in 2019 to The Bahamas valued $3.06 billion, resulting in a trade surplus of $2.6 billion in the United States’ favor.

The Bahamas maintains an open investment climate and actively promotes a liberal tax environment and freedom from many types of taxes, including capital gains, inheritance, and corporate or personal income taxes. The Bahamas does not offer export subsidies, engage in trade-distorting practices, or maintain a local content requirement. The country continues to attract FDI from various parts of the world and has recently benefitted from significant investments in the tourism sector from international companies based in China. Investments from the United States are also primarily in the tourism sector and range from general services to billion-dollar resort developments to million-dollar homes on the major islands of the archipelago.

Positive aspects of The Bahamas’ investment climate include: political stability since independence in 1973, a parliamentary democracy since 1729, an English-speaking labor force, a well-capitalized and profitable financial services infrastructure, established rule of law and general respect for contracts, an independent judicial system, and high per-capita GDP. Negative aspects of The Bahamas’ investment climate include: a lack of transparency in government procurement, shortages of skilled and unskilled labor in certain sectors, a bureaucratic and inefficient investment approvals process, time consuming resolution of legal disputes, the high cost of labor, and the high cost of energy, which averages four times higher than in the United States – primarily driven by antiquated generation systems and almost complete dependence on inefficient fossil-fueled power plants. To remedy this deficiency, however, the current government has prioritized infrastructure projects focused on non-oil energy, including an LNG plant on New Providence and various solar projects on the Family Islands.

A major challenge to investment in the country is the prohibition of foreign investment in 15 areas of the economy. The current government initially set a goal of accession to the WTO by the end of 2019, which would require opening at least some of these protected sectors to foreign investment. However, the government later described the 2019 target as purely aspirational, confirming it was unlikely accession would take place before 2025.

The absence of transparent investment procedures and legislation is also problematic. U.S. and Bahamian companies alike report the resolution of business disputes often takes years and collection of amounts due can be difficult even after court judgments. Companies also describe the approval process for FDI and work permits as cumbersome and time-consuming. The Bahamian government does not have modern procurement legislation and companies have complained the tender process for public contracts is not consistent, and that it is difficult to obtain information on the status of bids. In response, the FNM administration drafted a Public Procurement Bill, 2020 and launched an e-procurement and suppliers registry system to increase levels of accountability and transparency in governance. The government confirmed public consultation on the draft legislation is complete and it is being finalized for tabling in the House of Parliament by May 2020.

The Bahamas scored 64 out of 100 in Transparency International’s Corruption Perception Index in 2019 (where zero is perceived as highly corrupt and 100 is very transparent). This represents a slight improvement of the year on year score following a stabilization in 2018 and a marked increase in perceptions of corruption between 2014 and 2016. The Bahamas still lacks necessary legislation to establish an office of the ombudsman to strengthen access to information, nor has it fully enacted its Freedom of Information Bill or appointed an independent Information Commissioner. Although the current government is pursuing legislative reforms to strengthen further its investment policies, progress on these efforts has been mixed.

Women have raised concerns regarding the ease of their doing business in The Bahamas, particularly bureaucratic hurdles to register businesses and difficulty in securing financing on their own. The Prime Minister’s wife has committed to supporting women’s empowerment, particularly economic, as a priority of the Office of the Spouse of the Prime Minister. The Small Business Development Centre (SBDC) has also made economic empowerment of women entrepreneurs and lessoning the income gap priorities.

Table 1
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 64 of 100 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report “Ease of Doing Business” 2020 119 of 190 http://www.doingbusiness.org/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country (M USD, stock positions) 2018 18.5B http://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 30,520 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) (M USD) 2018 N/A 2018 12,425 https://data.worldbank.org/
country/bahamas
 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country (M USD, stock positions) 2018 N/A 2018 18,518 BEA data available at
http://bea.gov/international/
direct_investment_multinational_
companies_comprehensive_data.htm
 
Host country’s FDI in the United States (M USD, stock positions) 2018 N/A 2018 885 BEA data available at
http://bea.gov/international/
direct_investment_multinational_
companies_comprehensive_data.htm
 
Total inbound stock of FDI as % host GDP 2018 N/A 2018 169% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Bahrain

Executive Summary

The investment climate in Bahrain is generally positive and has remained relatively stable in the last year. Bahrain has a liberal approach to foreign investment and actively seeks to attract foreign investors and businesses.

In an economy largely dominated by state-owned enterprises, the Government of Bahrain (GOB) aims to foster a greater role for the private sector in economic growth. Government efforts focus on encouraging foreign direct investment (FDI) in the manufacturing, logistics, information and communications technology (ICT), financial services, and tourism sectors. Bahrain’s FDI as of June 2019 reached BD 10.9 billion (USD29 billion), with the majority of the investments from the financial services and insurance sector and the ICT sectors.

The Covid-19 pandemic, in tandem with the global oil price collapse in 2020, undermined GOB efforts to generate revenue and reduce spending. In April 2020, Bahrain introduced a BD 4.3 billion (USD11.4 billion), eight-point stimulus package to ease the economic impact of the Covid-19 pandemic, equivalent to 29 percent of Bahrain’s GDP. Many of the business-friendly subsidies were extended to foreign-owned and local companies alike, such as coverage of utility bills and waiver of tourism and industrial land fees.

To strengthen Bahrain’s position as a startup hub and to enhance the Kingdom’s investment ecosystem, the GOB in 2018 launched Bahrain FinTech Bay, the largest FinTech hub in the Middle East and Africa; issued four new laws covering data protection, competition, bankruptcy, and health insurance; established the USD100 million Al Waha venture capital fund for Bahraini investments; and set up a USD100 million ‘Superfund’ to support the growth of start-ups.

The U.S.-Bahrain Bilateral Investment Treaty (BIT) entered into force in 2001. The BIT provides benefits and protection to U.S. investors in Bahrain, such as most-favored nation treatment and national treatment, the right to make financial transfers freely and without delay, international law standards for expropriation and compensation cases, and access to international arbitration.

Bahrain permits 100 percent foreign ownership of new industrial entities and the establishment of representative offices or branches of foreign companies without local sponsors. In 2017, the GOB expanded the number of sectors in which foreigners are permitted to maintain 100 percent ownership stakes in companies to include tourism services, sporting events production, mining and quarrying, real estate activities, water distribution, water transport operations, and crop cultivation and propagation.  In May 2019, the GOB loosened foreign ownership restrictions in the oil and gas sector, allowing 100 percent foreign ownership in oil and gas extraction projects under certain conditions.

The U.S.-Bahrain Free Trade Agreement (FTA) entered into force in 2006. Under the FTA, Bahrain committed to world-class Intellectual Property Rights (IPR) protection.

Despite the GOB’s transparent, rules-based government procurement system, U.S. companies sometimes report operating at a perceived disadvantage compared with other firms in certain government procurements. Many ministries require firms to pre-qualify prior to bidding on a tender, often rendering firms with little or no prior experience in Bahrain ineligible to bid on major tenders.

Since 2017, the Central Bank of Bahrain (CBB) has operated a financial technology (FinTech) regulatory “sandbox” that enables the testing and launching of non-conventional FinTech startups in Bahrain, including cryptocurrency and blockchain technologies. The CBB also issued regulations to enable conventional and Sharia compliant financing-based crowdfunding businesses.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 77 of 175 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 43 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 78 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 USD 647 https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 USD 21,890 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2017 2018
2019
$38,30 $37,61
$38,53
2017 2018 $35,43 $37,74 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2017
2018
$256.78
$322.66
2017 2018 $423 $647 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2017
2018
$6,844
$4,600
2017
2018
$281 $157 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2017
2018
77.6%
75.7%
UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: www.data.gov.bh

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 28,992 100% Total Outward 19,233 100%
Kuwait 8,936 31% Kuwait 5,299 28%
Saudi Arabia 8,452 29% India 4,475 23%
Libya 2,990 10% United States 1,266 7%
Cayman Islands 1,857 6% Cayman Islands 1,251 7%
United Arab Emirates 1,613 6% Egypt 726 4%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 41,678 100% All Countries 8717 100% All Countries 32,961 100%
UAE 5,805 14% Cayman Islands 2,148 25% UAE 5,209 16%
United States 5,429 13% United States 1,595 18% Turkey 4,296 13%
Turkey 4,315 10% Saudi Arabia 748 9% United States 3,834 12%
Cayman Islands 3,432 8% UAE 596 7% Not Specified 2,647 8%
Qatar 2,949 7% Qatar 394 5% Qatar 2,554 8%

Bangladesh

Executive Summary

Bangladesh is the most densely populated non-city-state country in the world, with the eighth largest population (over 165 million) within a territory the size of Iowa. Bangladesh is situated in the northeastern corner of the Indian subcontinent, sharing a 4,100 km border with India and a 247 km border with Burma. With sustained economic growth over the past decade, a large, young, and hard-working workforce, strategic location between the large South and Southeast Asian markets, and vibrant private sector, Bangladesh will likely attract increasing investment, despite severe economic headwinds faced by the global outbreak of COVID-19.

Buoyed by a growing middle class, Bangladesh has enjoyed consistent annual GDP growth of more than six percent over the past decade. Much of this growth continues to be driven by the ready-made garment (RMG) industry, which exported $34.13 billion of apparel products in FY 2018-19, second only to China, and continued remittance inflows, reaching nearly $16.42 billion in FY 2018-19.

The Government of Bangladesh (GOB) actively seeks foreign investment, particularly in the agribusiness, garment/textiles, leather/leather goods, light manufacturing, power and energy, electronics, light engineering, information and communications technology (ICT), plastic, healthcare, medical equipment, pharmaceutical, ship building, and infrastructure sectors. It offers a range of investment incentives under its industrial policy and export-oriented growth strategy with few formal distinctions between foreign and domestic private investors.

Bangladesh received $3.6 billion in foreign direct investment (FDI) in 2018, a 67.9 percent increase from the previous year. However, the rate of FDI inflows is only slightly above one percent of GDP, one of the lowest of rates in Asia.

Bangladesh has made gradual progress in reducing some constraints on investment, including taking steps to better ensure reliable electricity, but inadequate infrastructure, limited financing instruments, bureaucratic delays, lax enforcement of labor laws, and corruption continue to hinder foreign investment. New government efforts to improve the business environment show promise but implementation has yet to materialize. Slow adoption of alternative dispute resolution mechanisms and sluggish judicial processes impede the enforcement of contracts and the resolution of business disputes.

A series of terrorist attacks from 2015-17, including the July 1, 2016 Holey Bakery attack in Dhaka’s diplomatic enclave, resulted in increased security restrictions for many expatriates, including U.S. Embassy staff. National elections, which were held on December 30, 2018, are prone to instances of political violence. The influx of more than 700,000 Rohingya refugees since August 2017 has also raised security concerns.

International brands and the international community continue to press the GOB to meaningfully address worker rights and factory safety problems in Bangladesh. With unprecedented support from the international community and the private sector, Bangladesh has made significant progress on fire and structural safety. Critical work remains on safeguarding workers’ rights to freely associate and bargain collectively, including in the Export Processing Zones (EPZs).

The GOB has limited resources devoted to intellectual property rights (IPR) protection and counterfeit goods are readily available in Bangladesh. Government policies in the ICT sector are still under development. Current policies grant the government broad powers to intervene in that sector.

Capital markets in Bangladesh are still developing and the financial sector is still highly dependent on banks.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 146 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report “Ease of Doing Business” 2019 168 of 190 doingbusiness.org/rankings
Global Innovation Index 2019 116 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in Partner Country ($M USD, stock positions) 2018 USD 513 https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 USD 1,750.0 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018-19 $298,374 2018 $274,025 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in Partner Country ($M USD, stock positions) 2018 $3449 2018 $513.0 https://apps.bea.gov/
international/factsheet/
 
Host Country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $3 million https://apps.bea.gov/
international/factsheet/
 
Total Inbound Stock of FDI as % host GDP 2018-19 6.3% 2018 5.9% https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data (December 2018)
From Top Five Sources/To Top Five Destinations (U.S. Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $16,032 100% Total Outward $3,075 100%
United States $3,391 21.15% Mainland China $667 21.69%
Mainland China $1,438 8.97% The Netherlands $649 21.11%
United Kingdom $1,423 8.88% South Korea $564 18.34%
The Netherlands $1,326 8.27% United States $513 16.68%
Singapore $1,156 7.21% Thailand $306 9.95%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets (June, 2019)
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries $4,579 100% All Countries $3,080 100% All Countries $1,499 100%
N/A United States $1,150 37.34% N/A
Luxemburg $479 15.55%
United Kingdom $478 15.52%
Singapore $184 5.97%
The Netherlands $167 5.4%

Barbados

Executive Summary

Barbados is the largest economy in the Eastern Caribbean.  Barbados’ Gross Domestic Product (GDP) was USD 5.03 billion in 2018.  The government of Barbados entered into a standby arrangement with the International Monetary Fund (IMF) in late 2018.  The USD 290 million Barbados Economic Recovery and Transformation (BERT) program aims to decrease the debt to GDP ratio, strengthen the balance of payments, and stimulate growth in the economy.  While the government met its IMF targets, the program dampened income and spending power due to public sector layoffs, the introduction of new indirect taxes, and a decline in the construction sector.  The coronavirus pandemic has reduced the gains that were expected to strengthen Barbados’ economic position in the near term.  The impact of the pandemic on tourism, a mainstay of Barbados’ economy which generates almost 40 percent of GDP, has had ripple effects across the economy.  The IMF agreed to reduce Barbados’ primary surplus targets and to augment its Extended Fund Facility.

Barbados ranks 128th out of 190 countries rated in the 2020 World Bank Doing Business Report.  The report highlights some positive changes in getting electricity, trading across borders, and enforcing contracts but highlights that registering property has become more difficult.

The services sector continues to hold the largest potential for growth, especially in the areas of international financial services, information technology, global education services, health, and cultural services.  The gradual decline of the sugar industry has opened up land for other agricultural uses.  Investment opportunities exist in the areas of agroprocessing and alternative and renewable energy.  Uncertainty about the recovery prospects of the tourism, commercial aviation, and the cruise industry impacts the potential for projects in those sectors.

Barbados recently revised its tax regime to harmonize its domestic and international tax rates.  This was in response to an Organization for Economic Cooperation and Development (OECD) initiative that addressed harmful tax practices.  Some acts were repealed or amended, and some new measures were introduced.  For further details, see https://investbarbados.org/revisedtaxregime.php.

Barbados bases its legal system on the British common law system.  It does not have a bilateral investment agreement with the United States, but it does have a double taxation treaty and tax information exchange agreement.

In 2015, Barbados signed an intergovernmental agreement in observance of the United States’ Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Barbados to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 30 of 175 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 128 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019  N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country (M USD, historical stock positions) 2018 20,368 http://apps.bea.gov/international/factsheet/
World Bank GNI per capita (M USD) 2018 15,410 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Barbados
Host Country Statistical Source* USG or International Statistical Source USG or International Source of Data
Economic Data Year Amount Year Amount
Host Country GDP (M USD) 2018 5036 2018 5,145 https://data.worldbank.org/
country/barbados
 
Foreign Direct Investment Host Country Statistical Source USG or International Statistical Source USG or International Source of Data
U.S. FDI in partner country (M USD, stock positions) N/A N/A 2018 33,276 https://apps.bea.gov/international/
factsheet/factsheet.cfm
 
Host country’s FDI in the United States (M USD, stock positions) N/A N/A 2018 6,225 https://apps.bea.gov/international/
factsheet/factsheet.cfm
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 141.4% https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

* Source for Host Country Data: Central Bank of Barbados (CBB) hhttp://data.centralbank.org.bb/GeneralStatistics.aspx  . All CBB GDP figures for 2018 are estimates.

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Belarus

Executive Summary

The Government of Belarus (GOB) officially welcomes foreign investment, which is seen as a source of new production technologies, jobs, and hard currency.  Belarusian authorities stress the country’s geographic location, its inclusion in the Eurasian Economic Union (which also includes Armenia, Kazakhstan, Kyrgyzstan, and Russia), extensive transport infrastructure, and a highly skilled workforce as competitive advantages for investment.  Belarus also highlights the preferential tax benefits and special investor incentives it provides for its six export-oriented and regionally located free economic zones, the IT sector-centric High Tech Park (HTP), and the joint Belarus-China Great Stone Industrial Park.

Belarus places a priority on investments in pharmaceuticals; biotechnology; nanotechnologies and nanomaterials; metallurgy; mechanical engineering industry; production of machines, electrical equipment, home appliances and electronics; transport and related infrastructure; agriculture and food industry; information and communication technologies; creation and development of logistics systems; and tourism.

In early 2019, Belarus’ State Property Committee approved a list of 23 joint stock companies for full or partial privatization. Also in 2019, the World Bank concluded a pilot project that identified and helped prepare 12 Belarusian SOEs for privatization. However, the GOB allowed sale of the government share in these companies on the condition that the purchasing investors preserve existing jobs and production lines. The State Property Committee reported that the government sold its minority share (under 25 percent) in only two enterprises in 2019.

Investments in sectors dominated by SOEs have been known to come under threat from regulatory bodies.  Investors, whether Belarusian or foreign, purportedly benefit from equal legal treatment and have the same right to conduct business operations or establish new business in Belarus.  However, according to numerous sources in the local business community and independent media, selective law enforcement and unwritten practices can discriminate against the private sector, including foreign investors, regardless of their country of origin.  Serious concerns remain about the independence of the judicial system and its ability to objectively adjudicate cases rather than favor the powerful central government.

When considering investing in Belarus, it is also important to note that pursuant to a June 2006 Executive Order, the United States maintains targeted sanctions against nine Belarusian SOEs and 16 individuals in relation to concerns about undermining Belarus’ democratic processes.  Since October 2015, however, the U.S. Department of Treasury, in consultation and coordination with the Department of State, has provided temporary sanctions relief for the nine SOEs. The current 18-month period of temporary sanctions relief ends on April 26, 2021.  For additional information click here:  https://www.treasury.gov/resource-center/sanctions/Programs/pages/belarus.aspx.

Despite GOB organizations that promote foreign direct investment (FDI), both the central and local governments’ policies often reflect an old-fashioned, Soviet-style distrust of private enterprise – whether local or foreign.  Technically the legal regime for foreign investments should be no less advantageous than the domestic one, yet FDI in many key sectors is limited, particularly in the petrochemical, agricultural, and alcohol production industries.  FDI is prohibited for national security reasons in defense as well as production and distribution of narcotics, dangerous and toxic substances.  FDI can also be restricted in activities and operations prohibited by law or in the interests of environmental protection, historical, and cultural values, public order, morality protection, public health, and rights and freedoms of individuals.  Investments in businesses that have a dominant position in the commodity markets of Belarus are not allowed without approved by the Ministry of Trade and Antimonopoly Regulation.

In 2019 the Council of Europe’s (COE) Group of States against Corruption (GRECO) publicly declared Belarus non-compliant with GRECO’s anti-corruption standards.  This was GRECO’s first ever declaration of non-compliance. According to the COE, Belarus failed to address 20 out of 24 recommendations made in 2012; had not authorized the publication of the 2012 report or related compliance reports; and was non-responsive since 2017 to requests from GRECO to organize a high-level mission to Belarus. In the first half of 2020, Belarusian courts convicted 463 individuals “on corruption-related charges.” However, the absence of independent judicial and law enforcement systems, the lack of separation of powers, and an independent press largely barred from interaction with a nontransparent state bureaucracy make it virtually impossible to gauge the true scale of corruption challenging the country.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 66 of 180 https://www.transparency.org/country/BLR
World Bank’s Doing Business Index 2020 49 of 190 https://www.doingbusiness.org/
en/data/exploreeconomies/belarus/#
Global Innovation Index 2018 72 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 N/A https://apps.bea.gov/international/
factsheet/factsheet.cfm?Area=336
World Bank GNI per capita 2018 $5,670 https://data.worldbank.org/country/
belarus?view=chart

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

According to official statistics, Belarus received USD 1.1 billion in FDI (on a net basis) in January-September 2019, USD 1.6 billion in 2018, USD 1.24 billion in FDI in 2017, and USD 1.3 billion in 2016. Russia (24.1 percent), Cyprus (20.6 percent), UAE (5.1 percent), Germany (4.9 percent), Switzerland (4.9 percent), UK (4.2 percent), China (4.1 percent), Netherlands (3.9 percent), USA (3.3 percent), and Poland (3.0 percent) are considered the top ten foreign investors in Belarus.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $63,100 2018 $59,700 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $54.5 2019 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2017 $39 2019 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 14.3 2018 34.8 UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data:

For detailed statistics on foreign direct investments in and outside Belarus for 2010-2019 see the website of Belarus’ National Bank (http://www.nbrb.by/engl/statistics/ForeignDirectInvestments/ ) and Economy Ministry (https://www.economy.gov.by/ru/pezultat-ru/ ). 

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 13,060 100% Total Outward 1,443 100%
Russian Federation 4,042 30.9% Russian Federation 1,191 82.5%
Cyprus 2,303 17.6% Cyprus 70.8 4.9%
Austria 1,070 8.2% Lithuania 50 3.5%
Turkey 552 4.2% Ukraine 43.3 3.0%
China 368 2.8 Venezuela 28.5 1.9%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 2,038 100% All Countries 2 100% All Countries 2036 100%
Luxembourg 811 39.7% Estonia 1 50% Luxembourg 811 39.7%
United States 503 24.6% Russian Federation 1 50% United States 503 24.6%
Germany 163 7.9% Germany 163 7.9%
Russian Federation 151 7.4% Russian Federation 151 7.4%
Denmark 78 3.8% Denmark 78 3.8%

Belgium

Executive Summary

The COVID-19 pandemic negatively impacted the Belgian economy in 2020. The National Bank of Belgium has estimated that real GDP could contract by as much as 8% in 2020, and the impact on public finances could lead to a deficit of at least 7.5% of GDP, withthe national debt to increase to around 115% of GDP by the end of 2020. Belgium will rely on European Union financial support mechanisms and interventions by its regional governments to pull itself out of the economic crisis created by the global health pandemic.

Belgium holds a unique position as a logistical hub and gateway to Europe, which will be of critical importance to jump-start the economy. Since June 2015, the Belgian government has undertaken a series of measures to reduce the tax burden on labor and to increase Belgium’s economic competitiveness and attractiveness to foreign investment. A July 2017 decision to lower the corporate tax rate from 35 to 25 percent further improved the investment climate. Post-pandemic measures to attract investment are under review with national and regional authorities.

In January 2016, the European Commission ruled that Belgium had to reclaim more than USD 900 million from companies that had benefitted from “excess profit” rulings. The scheme had reduced the corporate tax base of the companies by between 50% and 90% to discount for excess profits that allegedly resulted from being part of a multinational group. However, in 2019 the EU General Court decided that the excess profit ruling was not a State-aid scheme. The Commission has appealed the judgment to the European Court of Justice; these proceedings are ongoing.

Belgium boasts an open market well connected to the major economies of the world. As a logistical gateway to Europe, host to major EU institutions, and a central location closely tied to the major European economies, Belgium is an attractive market and location for U.S. investors. Belgium is a highly developed, long-time economic partner of the United States that benefits from an extremely well-educated workforce, world-renowned research centers, and the infrastructure to support a broad range of economic activities. Brexit and pandemic recovery create uncertainties and it is difficult to predict what the impacts will be on the Belgian economy.

Belgium has a dynamic economy and attracts significant levels of investment in chemicals, petrochemicals, plastic and composites; environmental technologies; food processing and packaging; health technologies; information and communication; and textiles, apparel and sporting goods, among other sectors.

To fully realize Belgium’s employment potential, it will be critical to address the fragmentation of the labor market. Jobs growth was accelerating until the COVID-19 pandemic, driven by the cyclical recovery and the positive impact of past reforms. Large regional disparities in unemployment rates persist, and there is a significant skills mismatch in several key sectors. Temporary unemployment skyrocketed to 1.26 million workers in April, 2020, but it is uncertain how the pandemic will impact overall unemployment in 2020.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 17 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 46 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 23 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 $64,051 https://apps.bea.gov/international/factsheet/
factsheet.cfm?Area=302&UUID=c2df3295-91fa-4db0-9759-f145ca5c6e83
World Bank GNI per capita 2018 $45,910 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2018 $542.8 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or internationalSource of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $64,051 BEA data available at https://apps.bea.gov/international/factsheet/
factsheet.cfm?Area=302&UUID=c2df3295-91fa-4db0-9759-f145ca5c6e83
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $100.2 BEA data available at https://apps.bea.gov/international/factsheet/
factsheet.cfm?Area=302&UUID=c2df3295-91fa-4db0-9759-f145ca5c6e83
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 98% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data 2018
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 537,832 100% Total Outward 594,141 100%
France 151,883 28% The Netherlands 199,187 34%
The Netherlands 133,447 25% Luxembourg 152,807 26%
Luxembourg 133,139 25% U.K. 79,235 13%
Switzerland 50,909 9% France 58,275 9%
Japan 18,954 4% Germany 14,902 3%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
Total 54,504,503 100% Total 29,142,053 100% Total 25,362,446 100%
United States 12,463,725 23% 8,861,990 30% 3,601,735 14%
Luxembourg 4,790,703 9% 2,229,956 8% 2,560,747 10%
Japan 4,492,701 8% 1,823,599 6% 2,669,103 11%
Germany 3,609,694 6% 1,304,519 4% 2,305,175 9%
U.K. 3,467,433 6% 2,009,115 7% 1,458,318 6%

Belize

Executive Summary

Belize has the smallest economy in Central America, with a Gross Domestic Product (GDP) of $1.4 billion based largely in tourism.  The country’s economic and fiscal outlook remains troubled, particularly with the global health and accompanying economic crisis.  Due to mounting fiscal pressures and a need to diversify and expand its economy, the Government is open to, and actively seeks, Foreign Direct Investment (FDI).  However, the small population of the country (estimated 408,487 people), high cost of doing business, high public debt, bureaucratic delays, often insufficient infrastructure, and corruption constitute investment challenges.

Belize’s proximity to the economically developed nations of North America has translated to dependence on tourism as the primary economic sector.  Agriculture as the second most important economic sector is based on a small group of exports, including sugar, banana, and citrus juice.  Belize’s small, tourism- and export-dependent economy is especially vulnerable to exogenous shocks, such as a weakened U.S. growth and depressed market environments.  As a key example, tourism has been a strong source of growth but was the first sector to collapse with onset of COVID-19.  Belize is also exposed to environmental disasters, such as drought, hurricanes, and climate-related effects.  Finally, Belize’s agricultural exports are often impacted by preferential market access policies common in the region.

The financial system can be characterized as stable but fragile.  The high cost of finance and relatively high lending rates are important constraints to economic growth.  Domestic banks accept only a low level of risk in business loans due to previously high default rates.  While the country has reestablished correspondent banking relationships lost in 2015, it resulted with fewer banking services at increased costs.  Key legislative reforms in 2019 advanced changes to the fiscal incentives regime and the international financial services regime primarily to comply with Organization for Economic Co-operation and Development (OECD) requirements, as well as amendments to the tax system.

Generally, Belize has no restrictions on foreign ownership or control of companies, though foreign investors must adhere to Central Bank of Belize regulations relating to the inflow and outflow of investment.  To be eligible for government-sponsored business incentives, Small and Medium-sized Enterprises (SMEs) and tour operators must have 51 percent local ownership.  The country also continues to rank poorly in international surveys of openness and ease of opening a business.   Government borrowing has accelerated as a result of COVID-19 mitigation and recovery efforts.  The country’s pre-pandemic estimates for debt to GDP of above 90 percent are expected to balloon to an estimated 112 percent to 125 percent in a post-COVID environment.

Belize’s regionally high per capita GDP, currency stability, and developing infrastructure do provide some investment opportunities.  Sectors that have traditionally attracted investment include tourism, business processing outsourcing such as call centers, agriculture, telecommunications, and renewable energy.  In a post-COVID-19 recovery, initial opportunities may lie in export diversification of agriculture, forestry, and renewable energy, and thereafter – in investments to jump start the tourism sector.

Table 1: Key Metrics and Rankings    
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 N/A http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 135 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 USD 75 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 USD 4,470 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics    

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy    
Host Country Statistical source USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $1.400 http://sib.org.bz/
www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $75 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $13 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 116.6% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

Table 3: Sources and Destination of FDI
The IMF’s Coordinated Direct Investment Survey does not have Belize data related to Inward and Outward Direct Investment.  Statistics on FDI in Belize by country of origin is limited, including the total invested by U.S. investors.  The Central Bank of Belize recorded total inflows of FDI at USD $135.89 million and outflows at USD $35.12 million in 2019.  Major sources of FDI include the United States, Canada, and the United Kingdom.  FDI inflows were concentrated primarily in construction, real estate, hotel and restaurant, and financial intermediation.

Table 4: Sources of Portfolio Investment
Data not available.

Benin

Executive Summary

Benin has been a stable democracy since 1990, enjoying until recently a reputation for regular, peaceful, and inclusive elections. In 2019, the government held legislative elections for which no opposition party qualified to participate and which were neither fully competitive nor inclusive. Elections-related unrest in 2019 left several people dead

Benin’s overall macroeconomic conditions were positive in 2019. According to IMF estimates, GDP growth increased from 6.7 percent in 2018 to 6.9 percent in 2019. The COVID-19 pandemic and Nigeria’s partial closure of its borders beginning in August 2019 are expected to slow GDP growth to 3.2 percent in 2020. Port activity and the cotton sector are the largest drivers of economic growth. Telecommunications, agriculture, energy, cement production, and construction are other significant components of the economy. Benin also has a large informal sector. The country’s GDP is roughly 51.1 percent services, 26.1 percent agriculture, and 22.8 percent manufacturing.

President Patrice Talon launched an ambitious $15 billion five-year Government Action Plan (PAG) in 2016. The PAG lays out a development plan structured around 45 major projects, 95 sector-based projects, and 19 institutional reforms.  With the goals of strengthening the administration of justice, fostering a structural transformation of the economy, and improving living conditions, the projects are concentrated in infrastructure, agriculture and agribusiness, tourism, health, and education.  The government estimates that full implementation of the PAG will result in the creation of 500,000 new jobs and a leap in national economic and social conditions. The government intended that 61 percent of the PAG be funded through public-private partnerships (PPPs), but through the end of 2019 no such partnerships had been secured. Government critics allege that the Talon administration is using the PAG in part to channel resources and contracts to administration insiders.

Benin continues efforts to attract private investment in support of economic growth. The Investment and Exports Promotion Agency (APIEX) is a one-stop-shop for promoting new investments, business startups, and foreign trade. In 2019, APIEX worked with foreign companies to facilitate new investments, though some companies reported that the agency was under-resourced and hamstrung by bureaucratic red tape in other agencies and ministries.

In June 2017, a five-year, $375 million Millennium Challenge Corporation (MCC) compact with Benin entered into force. The Benin Power Compact is advancing policy reforms to bolster financing for the electricity sector, attract private capital into power generation, and strengthen regulation and utility management. Through the compact MCC is expanding the capacity and increasing the reliability of Benin’s power grid in southern and northern Benin. As two thirds of Benin’s population does not have access to electricity, the compact also includes a significant off-grid electrification project via a clean energy grant facility that supports private sector investment in off-grid power systems. This follows Benin’s 2006-2011 compact, which modernized the country’s port – the principal source of government revenue – and improved land administration, the justice sector, and access to credit.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 80 of 183 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report “Ease of Doing Business” 2020 149 of 190 https://www.doingbusiness.org/
Global Innovation Index 2019 123 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, stock positions) N/A N/A http://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 $1,200 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) $13,933 2019 2018 $13,155 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $2 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 21.6% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

*Benin National Institute of Statistics and Economic Analysis (INSAE)

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions) 2018
Inward Direct Investment Outward Direct Investment
Total Inward 2,323 100% Total Outward 401 100%
France 1,129 48.6% France 196 48.9%
Togo 561 24.1% Senegal 77 19.2%
Cote d’Ivoire 262 11.3% Cote d’Ivoire 47 11.7%
Morocco 204 8.8% Mali 45 11.2%
Senegal 167 7.2% Kenya 36 8.9%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Data not available.

Bolivia

Executive Summary

In general, Bolivia is open to foreign direct investment (FDI).  In November 2019, a transitional government came to power that indicated an interest in taking additional steps to attract more FDI.  However, no legislative nor constitutional changes have taken place.  New elections are scheduled for late 2020. A 2014 investment promotion law guarantees equal treatment for national and foreign firms, however, it also stipulates that public investment has priority over private investment (both national and foreign) and that the Bolivian Government will determine which sectors require private investment.  Gross FDI into Bolivia was approximately USD 781 million in 2018 (a decrease of approximately USD 420 million compared to 2017), primarily concentrated in the hydrocarbons and mining sectors.

U.S. companies interested in investing in Bolivia should note that in 2012 Bolivia abrogated the Bilateral Investment Treaties (BITs) it signed with the U.S. and a number of other countries.  The Bolivian Government claimed the abrogation was necessary for Bolivia to comply with the 2009 Constitution.  Companies that invested under the U.S.–Bolivia BIT will be covered until June 10, 2022, but investments made after June 10, 2012 are not covered.

Notwithstanding the uncertain political situation, Bolivia’s investment climate has remained relatively steady over the past several years.  Lack of legal security, corruption allegations, and unclear investment incentives are all impediments to investment in Bolivia.  At the moment, there is no significant foreign direct investment from the United States in Bolivia, and there are no initiatives designed specifically to encourage U.S. investment.  The Ministry of Foreign Affairs and Ministry of Planning are leading efforts to attract more foreign investment (including the launching of a new website, http://www.investbolivia.gob.bo/), but it is not clear if they will be successful, given upcoming re-run elections currently scheduled for October 2020.  But Bolivia’s current macroeconomic stability, abundant natural resources, and strategic location in the heart of South America make it a country to watch.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 123 of 198 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 150 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 110 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, stock positions) 2018 $618 http://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 $3,370 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

In 2019, the investment rate as percentage of GDP (19 percent) was in line with regional averages.  There has also been a shift from private to public investment.  In recent years private investment was particularly low because of the deterioration of the business environment.  From 2006 to 2019, private investment, including local and foreign investment, averaged 8 percent of GDP.  In contrast, from 2006 to the present, public investment grew significantly, reaching an annual average of 11 percent of GDP through 2019.

FDI is highly concentrated in natural resources, especially hydrocarbons and mining, which account for nearly two-thirds of FDI.  Since 2006 the net flow of FDI averaged 2.4 percent of GDP.  Before 2006 it averaged around 6.7 percent of GDP.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical Source USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2018 $40,287 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical Source USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $618 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2018 23 2017 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 2.2% 2017 2.0% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
Table 3: Sources and Destination of FDI
Direct Investment From/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 11,878 100% Total Outward 815 100%
Spain 2,637 22.3% Netherlands 346 42.5%
Sweden 1,995 16.8% Other Countries (not specified) 142 17%
Netherlands 1,253 10.6% Panama 63 7.72%
Peru 1,125 9.5% Brazil 61 7.52%
France 741 6.3% Spain 49 6.1%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, US Dollars)
Total Equity Securities Total Debt Securities
All Countries 3,884 100% All Countries 246 100% All Countries 3,638 100%
United States 1,949 50.2% Other Countries (not specified) 98 39.9% United States 1,863 51.2%
 Other Countries (not specified) 473 14.8% United States 86 34.8% Other Countries (not specified) 476 13.1%
The Netherlands 473 12.2% Cayman Islands 62 25.3% The Netherlands 473 13.0%
Germany 143 3.7% International Organizations 210 5.8%
Canada 105 2.7% Germany 145 4.0%

Bosnia and Herzegovina

Executive Summary

Bosnia and Herzegovina (BiH) is open to foreign investment, but investors must overcome endemic corruption, complex legal and regulatory frameworks and government structures, non-transparent business procedures, insufficient protection of property rights, and a weak judicial system to succeed.  Economic reforms to complete the transition from a socialist past to a market-oriented future have proceeded slowly and the country has a relatively low level of foreign direct investment (FDI).  According to the BiH Central Bank, FDI in BiH in the first nine months of 2019 amounted to  USD 505 million.  Total FDI in 2018 amounted to  USD 458 million. According to the World Bank’s 2020 Ease of Doing Business Report, BiH is among the least attractive business environments in Southeast Europe, with a ranking of 90 out of 190 global economies.  The WB report ranks BiH particularly low for its lengthy and arduous processes to start a new business and obtain construction permits, both issues which have impacted American companies.  Before the COVID19 pandemic, BiH’s economic growth was expected to gain speed in 2020 before reaching 4 percent in 2021, backed mainly by consumption and to some extent by public investment.  BiH’s economy expanded by an estimated 3.0 percent in 2019, with domestic demand remaining the dominant growth driver.

U.S. investment in BiH is low due to the small market size, relatively low-income levels, distance from the United States, challenging business climate, and the lack of investment opportunities.  Most U.S. companies in BiH are represented by small sales offices that are concentrated on selling U.S. goods and services, with minimal longer-term investments in BiH. U.S. companies with offices in BiH include major multinational companies and market leaders in their respective sectors, such as Coca-Cola, Microsoft, Cisco, Oracle, Pfizer, McDonalds, Marriott, Caterpillar, Johnson&Johnson, FedEx, UPS, Philip Morris, KPMG, Price WaterHouse Coopers and others.  Nonetheless, BiH offers business opportunities to well-prepared and persistent exporters and investors.  Companies who have managed to overcome the challenges of establishing a presence in BiH have often made a return on their investment over time.  A major U.S. investment fund was able to enter the market with a regional investment in 2014 and exit its majority position in 2019 with a good return.  There is an active international community and many reform efforts to improve the business climate as BiH pursues eventual European Union membership.  The country is open to foreign investment and offers a liberal trade regime and simplified tax structure (17 percent VAT and 10 percent flat income tax).  BiH is actively pursuing World Trade Organization membership and hopes to join that organization in the near future.  It is also richly endowed with natural resources, providing potential opportunities in energy (hydro and thermal power plants), agriculture, timber, and tourism.  The best business opportunities for U.S. exporters to BiH include energy generation and transmission equipment, telecommunication and IT equipment and services, transport infrastructure and equipment, engineering and construction services, medical equipment, and raw materials and chemicals for industrial processing.  In 2019, U.S. exports to BiH totaled USD 394 million, a 3.6 percent increase from 2018, and held a 3.4 percent share of total BiH imports.  BiH exports to the United States in 2019 totaled $30.5 million. U.S. exports to BiH are primarily in the areas of raw materials for industrial processing, food and agricultural products, machinery and transport equipment, and mineral fuels.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website
TI Corruption Perceptions Index 2019 101 of 180 www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report “Ease of Doing Business” 2020 90 of 190 www.doingbusiness.org/rankings
Global Innovation Index 2019 77 of 128 https://www.globalinnovationindex.org/
home
U.S. FDI in BiH 2019 $9  million  https://apps.bea.gov/international/
factsheet/factsheet.cfm
World Bank GNI per capita 2018     $5,740 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $20.8 billion www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI ($M USD, stock positions)     2019 $250 million (estimate) N/A N/A N/A
FDI in the United States ($M USD, stock positions)          N/A N/A N/A N/A N/A
Total inbound stock of FDI as %  GDP ($M USD, stock positions)       N/A N/A N/A N/A N/A
Table 3: Sources of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $8,372 100% Total Outward 512 100%
Austria $1,558 18.6% Croatia 135 26.4%
Croatia $1,343 16% Germany 96 18.6%
Serbia $1,186 14.2% Serbia 48 9.3%
Slovenia $630 7.5% Montenegro 45 8.8%
Netherlands $510 6.1% The Netherlands 40 7.8%
“0” reflects amounts rounded to +/- USD 500,000.

According to the BiH Central Bank, FDI in BiH in the first nine months of 2019 amounted to USD 505 million. In 2018, total FDI in BiH was USD 458 million.  The all-time high for FDI was USD 2.1 billion in 2007.  Most investments in 2014-2019 came from Croatia, Austria, Russia, Serbia, The Netherlands, UAE, and the United Kingdom.

Table 4: Sources of Portfolio Investment
Data not available.

Botswana

Executive Summary

Botswana has a population of 2.2 million and is centrally located in Southern Africa, enabling it to serve as a gateway to the region.  Botswana has historically enjoyed high economic growth rates and its export-driven economy is highly correlated with global economic trends.  Development has been driven mainly by revenue from diamond mining, which has enabled Botswana to provide infrastructure and social services.  The economy grew by 2.3 percent in 2019 after registering growth of 4.5 percent in 2018, driven by performance of the mining sector (GDP 2019 report – Statistics Botswana). The COVID-19 crisis is expected to decrease 2020 diamond sales by nearly 70 percent, which could lead to severe economic contraction, increased unemployment, and government deficits. In recent years inflation has remained at the bottom end of the central bank’s 3 to 6 percent spectrum.  According to the United Nations Conference on Trade and Development (UNCTAD), the total stock of foreign direct investment (FDI) in Botswana reached USD 4.82 billion in 2018. Botswana is classified as an upper middle-income country by the World Bank based on its per capita income of USD 8,259.

Botswana is a stable, democratic country with an independent judiciary system.  It maintains a sound macroeconomic environment, fiscal discipline, a well-capitalized banking system, and a crawling peg exchange rate system.  In March 2020, Standard & Poor’s (S&P) downgraded the country’s sovereign credit rating for long-term foreign and domestic currency bonds from “A-” to “BBB+”. Botswana has minimal labor strife.  It is a member state to both the International Centre for Settlement of Investment Disputes (ICSID) Convention and the 1958 New York Convention.  Corruption in Botswana remains less pervasive than in other parts of Africa; nevertheless, foreign and national companies have commented on increasing tender-related corruption.  The World Bank ranked Botswana 87 out of 190 economies in the category of Ease of Doing Business in 2020, falling by one place from 86 in 2019. The country also fell in the 2019 World Economic Forum’s Global Competitiveness Index to 91 out of 141, from 90 out of 140 in 2018.

The Government of Botswana (GoB) created the Botswana Investment and Trade Centre (BITC) to assist foreign investors, offers low tax rates, and has no foreign exchange controls.  Its topline economic goals are to diversify the economy, create employment, and transfer skills to Botswana citizens.  GoB entities, including BITC, use these criteria in determining whether it assists foreign investors.  The GoB drafted an investment facilitation law in 2016 with the support of the United Nations Conference on Trade and Development (UNCTAD), but the law has yet to be enacted. The GoB has committed to streamline business-related procedures, and remove bureaucratic impediments based on World Bank recommendations as part of a business reform roadmap; under this framework, it introduced some electronic tax and customs processes in 2016 and 2017.  The Companies and Intellectual Property Authority (CIPA) built and successfully integrated the Online Business Registration System (OBRS) with Botswana Unified Revenue Services (BURS) and the Immigration Office. OBRS is designed to reduce the business registration process by more than 10 days. The GoB also set up the Special Economic Zones Authority (SEZA) to streamline investment in sector-targeted geographic areas in the country.

It is still too early to determine the full economic impact of the COVID-19 crisis on Botswana, however, the GoB’s COVID-19 relief program (wage subsidies, loan guarantees, tax and payment holidays) is garnering positive initial reviews from the international community.

Table 1: Key Metrics and Rankings 
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 34 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 87 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 93 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 N/A https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 $7,750 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics 

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy 
Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($ USD) N/A N/A 2018 $18.6 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD) N/A N/A 2018 $-11 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $0 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2019 26.9% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
  

According to the Bank of Botswana, investment in Botswana totaled 80.5 billion Pula in 2017, of which 28.9 billion Pula were non-FDI investments.  Africa (36 percent) and Europe (56 percent) accounted for most of the 51.64 billion Pula influx of FDI.  Within these regions, South Africa and the United Kingdom were the predominant players, accounting for 10.6 and 26.3 billion Pula respectively.  Little data on FDI sources is available for countries and regions with limited investments in Botswana.  Mining accounted for 35.1 percent of Foreign Investment inflows in 2017.

Table 3: Sources and Destination of FDI 
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/to Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward Amount 100% Total Outward Amount 100%
Africa 185.89 36% N/A
Europe 288.95 56%
Asia Pacific 11.67 2.3%
North & Central America 16.02 3%
Middle East 13.06 2.5%
Other                                      3.5          0.1%
Table 4: Sources of Portfolio Investment 
IMF Coordinated Direct Investment Survey data are not available for Botswana.  2018 estimates for Botswana’s net international investments declined by 11.1 percent from 70.9 billion Pula in 2017 to 63 billion Pula in 2018.  On the assets side, direct investments, portfolio investments, and foreign exchange reserves decreased by 6.9 percent, 13.1 percent, and 3.1 percent respectively.  Portfolio investment decreased due to the decline in equity and debt securities invested abroad.

Brunei

Executive Summary

Brunei is a small, energy-rich Sultanate on the northern coast of Borneo in Southeast Asia. Brunei boasts a well-educated, largely English-speaking population, excellent infrastructure, and a government intent on attracting foreign investment and projects. In parallel with Brunei’s efforts to attract foreign investment and create an open and transparent investment regime, the country has taken steps to streamline the process for entrepreneurs and investors to establish businesses and has improved its protections for Intellectual Property Rights (IPR).

Despite senior Bruneian leaders’ repeated calls for diversification, Brunei’s economy remains dependent on the income derived from sales of oil and gas, contributing about 60 percent to the country’s GDP. Substantial revenue from overseas investment supplements income from domestic hydrocarbon production. These two revenue streams provide a comfortable quality of life for Brunei’s population. Citizens are not required to pay taxes and have access to free education through the university level, free medical care, and subsidized housing and car fuel.

Brunei has a stable political climate and is generally sheltered from natural disasters. Brunei’s central location in Southeast Asia, with good telecommunications and airline connections, business tax credits in specified sectors, and no income, sales, or export taxes, offers a welcoming climate for potential investors. Sectors offering U.S. business opportunities in Brunei include aerospace and defense, agribusiness, construction, petrochemicals, energy and mining, environmental technologies, food processing and packaging, franchising, health technologies, information and communication, digital finance, and services.

In 2014, Brunei began implementing sections of its Sharia Penal Code (SPC) that expanded preexisting restrictions on activities such as alcohol consumption, eating in public during the fasting hours in the month of Ramadan, and indecent behavior, with possible punishments including fines and imprisonment. The SPC functions in parallel with Brunei’s common law-based civil penal code. The government commenced full implementation of the SPC in 2019, introducing the possibility of corporal and capital punishments including, under certain evidentiary circumstances, amputation for theft and death by stoning for offenses including sodomy, adultery, and blasphemy. Government officials emphasize that sentencing to the most severe punishments is highly improbable due to the very high standard of proof required by the SPC. While the SPC does not specifically address business-related matters, potential investors should be aware that there is controversy surrounding the SPC issue. Thus far there have been no recorded incidents of U.S. citizens or U.S. investments directly affected by sharia law.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 35 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 66 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 71 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 USD 15 https://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 USD 29,660 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 13,000 2018 13,600 World Bank data available at
www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2017 -1.4 2018 15 Host country data available at depd.gov.bn 
BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A No public data available.
Total inbound stock of FDI as % host GDP N/A N/A 2018 47.6% UNCTAD data available at
https://unctad.org/en/Pages/
DIAE/World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

*Host country data available at depd.gov.bn 

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Bulgaria

Executive Summary

Bulgaria is seen by many investors as an attractive investment destination, with government incentives for new investment.  The country continues to offer some of the least expensive labor in the EU and low and flat corporate and income taxes.  However, the steady rise in wages, significantly outpacing the growth rate of labor productivity, may gradually erode this competitive edge.

The COVID-19 pandemic sent shockwaves through the Bulgarian economy, resulting in large-scale layoffs and a revision of the 2020 GDP from growth of about three percent to a three-percent contraction; some projections foresee a still-deeper contraction.  As of late April 2020, the government’s aggressive fiscal measures to support the economy reached 3.9 percent of the projected 2020 GDP.  This will lead to a projected fiscal deficit of 2.9 percent of the GDP for the year.

The pandemic severely affected a wide range of sectors.  Bulgaria’s automotive sector, which specializes mainly in production of spare parts, suffered due to the disruption of global supply chains.  Also hit hard by the crisis were the tourism, transportation and logistics, and aviation sectors.  By contrast, the IT sector appeared to be faring relatively well.

As of late April 2020, the government appeared resolved to apply for membership in the Eurozone’s precursor mechanism ERM II.  While even in the best scenario full Euro adoption is years away, successful adoption of the Euro would fully eliminate the currency risk and help reduce transaction costs with some of Bulgaria’s key trading partners.

Foreign investors remain concerned about rule of law in Bulgaria.  Corruption is endemic, particularly on large infrastructure projects and in the energy sector.  Investors cite other problems impeding investment, such as unpredictability due to frequent regulatory and legislative changes and a slow judicial system. As of early 2020, there are questions as to the government commitment to upholding its contracts, including with U.S. investors.  A key factor to watch will be the fairness of these negotiations. Another U.S. company has faced extended regulatory obstacles in its attempts to enter the energy market.

Table 1: Key Metrics and Rankings  
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 74 of 180 http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2020 61 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 40 of 129 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 928 http://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 8,860 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy  
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $64,149 2018 $65,133 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $1,119 2018 $928 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2017 $32 2017 $29 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 $49,276 2018 75.9% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: Bulgarian National Bank

Table 3: Sources and Destination of FDI  
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 49,038 100% Total Outward n/a 100%
The Netherlands 9,038 18.4% Country #1 n/a X%
Austria 4,643 9.5% Country #2 n/a X%
Germany 3,502 7.1% Country #3 n/a X%
Italy 2,893 5.9% Country #4 n/a X%
Greece 2,537 5.2% Country #5  n/a X%
“0” reflects amounts rounded to +/- USD 500,000.

The data are consistent.  The data for outward investment is not available.  Note: For inward investment, the Netherlands holds the top place largely because various companies, most notably Russia’s Lukoil, channel their investments to Bulgaria through Dutch subsidiaries.  While official data routinely lists the United States as the 13th-largest source of FDI into Bulgaria, a recent study, which accounts for investment flows via European subsidiaries of U.S. companies, puts the United States into the sixth place.

Table 4: Sources of Portfolio Investment  
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 8,946 100% All Countries 2,418 100% All Countries 6,528 100%
U.S. 1,148 12.8% U.S. 648 26.8% Romania 955 14.6%
Romania 961 10.7% Luxembourg 633 26.2% Poland 547 8.4%
Luxembourg 692 7.7% Germany 248 10.3% U.S. 500 7.7%
Poland 551 6.2% Ireland 220 9.1% Hungary 490 7.5%
Czech Republic 497 5.6% France 159 6.6% Czech Republic 426 6.5%

Luxembourg is known to be a common place for incorporating companies whose actual ownership is Bulgarian.

Burkina Faso

Executive Summary

Burkina Faso welcomes foreign investment and actively seeks to attract foreign partners to aid in its development.  It has partially put in place the legal and regulatory framework necessary to ensure that foreign investors are treated fairly, including setting up a venue for commercial disputes and streamlining the issuance of permits and company registration requirements.  More progress is needed on diminishing the influence of state-owned firms in certain sectors and enforcing intellectual property protections.  Burkina Faso scored 56.7, a 2.7 points decrease for fiscal health, in the 2020 Heritage Foundation Economic Freedom Index and ranked 85 out of 180 countries in Transparency International’s 2019 Corruption Index.

The gold mining industry has boomed in the last seven years, and the bulk of foreign investment is in the mining sector, mostly from Canadian firms.  Moroccan, French and UAE companies control local subsidiaries in the telecommunications industry, while foreign investors are also active in the agriculture and transport sectors.  In June 2015, a new mining code was approved with the intent to standardize contract terms and better regulate the sector, but the new code is not yet fully operational.  In 2018, the parliament adopted a new investment code that offers many advantages to foreign investors. This code offers a range of tax breaks and incentives to lure foreign investors, including exemptions from value-added tax on certain equipment.  Effective tax rates as a result are lower than the regional average, though the tax system is complex, and compliance can be burdensome.  Opportunities for U.S. firms exist in the energy sector, where the government has an ambitious plan for the installation of new power capacity in both traditional and renewable sources.

Burkina Faso is a landlocked country and the world’s seventh poorest country according to the 2019 UN Development Program (UNDP) Human Development Index, ranked at 182 out of 189 countries.  With a population of 20.28 million inhabitants in June 2019, an estimated 44 percent live under the poverty line.  Some 80 percent of the country’s population is engaged in agriculture—mostly subsistence—with only a small fraction directly involved in agribusiness. There is a significant foreign investment interest in the growing security sector, and since Burkina Faso broke off relations with Taiwan in May 2018, a growing number of Chinese development projects. The government remains committed to a market-based economy without the establishment of any barriers to trade.  Between 2006 and 2015, the national power utility’s (Société Nationale de l’Eléctricité du Burkina) customer base and consumption doubled; however, supply can only meet the demand in non-peak periods.  The GoBF has set an ambitious goal of increasing the access rate to 40 percent by 2020.  The Millennium Challenge Corporation (MCC) Board of Directors, on June 17, approved the second compact for Burkina Faso to focus on addressing the primary constraint to economic growth: the high cost, poor quality, and low access to electricity.  The compact aims to improve energy infrastructure, generation capacity, and source diversification—it will also support Burkina Faso’s increased participation in regional power markets and development of a potential MCC regional investment.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 85 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 151 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 117 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 NA https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 $670 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $15,746 www.worldbank.org/
en/country
 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2019 16.9% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
  
Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 3,322 100% Total Outward 143 100%
Canada 1,091 N/A Mali 33 N/A
Barbados 662 N/A Senegal 30t N/A
France 283 N/A Côte d’Ivoire 24t N/A
United Kingdom 250 N/A Togo 20 N/A
Mali 178 N/A Benin 18 N/A
“0” reflects amounts rounded to +/- USD 500,000.

Table 4: Sources of Portfolio Investment
Data not available.

Burma

Executive Summary

Burma’s economic reforms since 2011 have created opportunities for investment throughout the country.  With a rich natural resource base, a young labor force, and prime geographic location, Burma has tremendous economic potential.  Recent reforms, such as opening up retail and wholesale trade to FDI, liberalizing the insurance sector, and streamlining business registrations are designed to increase foreign direct investment.

Many challenges remain, however, with Myanmar ranking 165 out of 190 countries on the World Bank’s index for the ease of doing business. Electricity shortages, limited infrastructure, and weak institutions continue to hinder foreign investment.  A continuing area of concern for foreigners involves investment in large-scale land projects. Property rights for large plots of land for investment commonly are disputed because ownership is not well established, particularly following a half-century of military expropriations. It is not uncommon for foreign firms to face complaints from local communities about inadequate consultation and compensation regarding land.

While still facing implementation challenges, Aung San Suu Kyi’s National League for Democracy (NLD)-led government has taken steps to counter government corruption and has called for greater transparency and foreign investment. In its 2019 Corruption Perceptions Index, Transparency International rated Burma 130 out of 175 countries. Investors might encounter corruption when seeking investment permits, during the taxation process, when applying for import and export licenses, or when negotiating land and real estate leases.

In January 2020, the Ministry of Investment and Foreign Economic Relations (MIFER) announced tax exemptions for investments made in five priority sectors in all 14 states and regions in Burma as well as the capital territory. The tax exemption period is three, five, or seven years depending on the location. For a list of priority sectors by state and regions, please see MIFER’s website at: http://www.mifer.gov.mm/region

In November 2019, the Central Bank of Myanmar (CBM) announced that foreign banks will be allowed to apply for licenses to operate subsidiaries or branches. Under new directives, any foreign bank applying for a subsidiary license would be allowed to provide wholesale banking services at the start of operation. From January 2021, foreign banks with a subsidiary license will be allowed to offer retail banking services. The CBM will allow existing foreign bank branches to convert to subsidiaries starting from June 2020. In January 2020, the CBM announced foreign banks would be permitted to hold more than 35 percent of the capital in joint ventures with domestic banks.

In July 2019, the Securities and Exchange Commission announced that foreign individuals and entities are permitted to hold up to 35 percent of the equity in Burmese companies listed on the Yangon Stock Exchange. As of March 2020, six companies are listed on the exchange.

In February 2020, the government passed a new Insolvency Law, which adopts the United Nations Commission on International Trade Law (UNCITRAL) Model Law on cross-border insolvency, providing greater legal certainty on transnational insolvency issues.

While Burma’s Parliament passed four intellectual property laws in 2019 – the Trademark Law, Industrial Design Law, Patent Law, and Copyright Law – these laws have not yet entered into force at the time of this writing. The Burmese government is in the process of drafting implementing regulations and setting up an IP Office to administer the laws. Once in effect, the laws will likely improve intellectual property protection, and enforcement measures against intellectual property rights infringement. In March 2020, the government formed an IP Central Committee, chaired by a Vice-President, to oversee the IP Department. Establishing the committee is widely viewed as an important step in further developing Burma’s IPR protection regime.

The 2020 national elections will be important for potential investors to watch as will continued work by the government to mitigate the economic impact of COVID-19.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 130 of 175 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 165 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, stock positions) 2019 98.34 https://www.dica.gov.mm/sites/dica.gov.mm/
files/document-files/yearly_country_4.pdf
World Bank GNI per capita 2018 USD 1,310 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 N/A 2019 65,994 https://www.imf.org/external/pubs/ft/weo/
2019/02/weodata/weorept.aspx?pr.x=56&pr.y=9&sy=2017&ey=2024&scsm=
1&ssd=1&sort=country&ds=.&br=1&c=
518&s=NGDPD&grp=0&a=
 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2019 98.34* N/A N/A
Host country’s FDI in the United States ($M USD, stock positions)** N/A N/A N/A N/A
Total inbound stock of FDI as % host GDP N/A N/A 2018 45.7 https://unctad.org/sections/dite_dir/docs/
wir2019/wir19_fs_mm_en.pdf
 

* https://www.dica.gov.mm/sites/dica.gov.mm/files/document-files/yearly_country_4.pdf 

** Accurate statistical data is limited in Burma, although this capacity is also being developed.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment (2018)* Outward Direct Investment
Total Inward 27325 100% N/A
Singapore 7590 27.8%
China 6929 25.3%
Thailand 3393 12.4%
Japan 2686 9.8%
United Kingdom 1078 3.9%
“0” reflects amounts rounded to +/- USD 500,000.

* According to http://data.imf.org/CDIS 

Table 4: Sources of Portfolio Investment
Data not available.

Burundi

Executive Summary

Burundi is a landlocked country in Central Africa and is one of the six member states of the East African Community (EAC). A socio-political and economic crisis associated with the 2015 national elections, followed by a severe economic downturn, exacerbated the poor fundamentals of an already difficult investment climate. Although a modest recovery is underway, economic growth remains insufficient to create employment for Burundi’s rapidly growing population. For almost two-thirds of the population living below the poverty line (2017 estimates), Burundi remains one of the world’s most impoverished countries, with approximately 90 percent of the population reliant on subsistence farming and a youth unemployment rate particularly high (about 65 percent).

  • Burundi’s landlocked location and infrastructure constraints limit transportation of goods and services. Electricity demand significantly exceeds capacity and the transmission system is poorly maintained, leading to rolling blackouts. Although activity has increased in the mining sector, the scale of the commercially exploitable resources remains unclear. Scarcity of skilled labor and low labor productivity limit growth in all sectors.
  • The Government of Burundi (GoB) seeks to attract more foreign investment. Various initiatives are underway to modernize and diversify agricultural production, build power plants (Jiji and Mulembwe hydro plant power already implemented), improve access to the country (rehabilitation of the Port of Bujumbura is underway ), increase regional trade by strengthening the transport network and improving the quality of human resources. However, poor governance and poor infrastructure, corruption, financial restrictions and capital controls that limit the expatriation of foreign currency, a low-skilled workforce and limited/unreliable economic statistics often limit foreign direct investment (FDI).
  • Since 2008, members of the executive branch have granted large discretionary exemptions to private foreign companies by presidential decree or ministerial ordinance in order to attract FDI. These direct government-to-company agreements undermine the Burundian tax law and the investment code. In addition to reducing revenues for the state, these exemptions disadvantage private companies already operating in Burundi by granting advantages to select competitors. The corporate tax rate is 30 percent, with reductions for companies that employ certain numbers of Burundian nationals.
Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 165 of 175 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 166 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 128 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 N/A https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 280 USD http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 3,248* 2018 3,037 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 6.8* 2018 7.1 UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* BRB (Bank of the Republic of Burundi), 2017 Annual Report (at official exchange rate).

Table 3: Sources and Destination of FDI
No detailed information is available on the IMF’s Coordinated Portfolio Investment Survey (CPIS) website and no information is available on outward direct investment from Burundi.
Table 4: Sources of Portfolio Investment
No detailed information is available on the IMF’s Coordinated Portfolio Investment Survey (CPIS) website and no information is available on outward direct investment from Burundi.

Cabo Verde

Executive Summary

The archipelago of Cabo Verde is composed of 10 volcanic islands and eight islets and is located in the mid-Atlantic Ocean approximately 450 miles west of Senegal. It has a land area of 4,033 square kilometers and a 700,000 square kilometer maritime Economic Exclusive Zone (EEZ). Approximately 570,000 people inhabit nine islands of the islands. Cabo Verde’s low proportion of arable land, scant rainfall, lack of natural resources, territorial discontinuity, and small population make it a high-cost economy with few economies of scale. Cabo Verde is vulnerable to external shocks, and the country depends on imports, development aid, foreign investment, remittances, and tourism.

Cabo Verde graduated to developed country status in 2007 and met most of its Millennium Development Goals by 2015. It invested in political stability and has a history of parliamentary democracy and economic freedom that is unusual in the region. Elections are free, fair, and regular, and there have always been smooth transitions of power. Good governance, prudent macroeconomic management – including strong fiscal, monetary, and exchange-rate policies – trade openness and increasing integration into the global economy, and the adoption of effective social development policies have contributed to its success. Broad political stability is expected to prevail in Cabo Verde, underpinned by strong democratic institutions and decent protection of human rights and civic freedoms. The business and investment climate continues to improve, although there are bureaucratic and cultural challenges to overcome.

The government’s Strategic Plan for Sustainable Development (PEDS 2017-2021) included a commitment to privatizing various sectors of the economy and addressing macroeconomic challenges. It aimed to create 45,000 new jobs by the end of 2020 and to position Cabo Verde as a mid-Atlantic platform, taking advantage of its geostrategic location between the African, European, and American continents. The strategy sought to harness the domestic and international private sector as the key driver for continued economic development. The government targeted renewable energy, tourism, maritime and air transportation, information, and communications technology (ICT), blue economy industries, financial services, and agribusiness as the key sectors for private sector investors and public-private partnerships. In 2018 and 2019, the government organized a series of investment conferences, including one in Boston, to promote Cabo Verde as a stable, open, and attractive investment destination. The government plans to hold additional conferences after travel restrictions caused by the COVID-19 pandemic are lifted. Despite several years of impressive progress, economic contraction caused by COVID-19 will prevent the government from fully achieving its original goals under the PEDS 2017-2021. The government is working on a Recovery Plan for the Cabo Verdean economy for the post-COVID-19 period which is expected to update the strategy, goals, and objectives until 2030.

The government continues work on reforms aimed at developing the private sector and attracting foreign investment to diversify the economy and mitigate high unemployment, which reduced from 12.2 percent in 2018 to 10.7 percent in the first half of 2019. Signs of progress in creating jobs, however, are limited. There are few regulatory barriers to foreign investment in Cabo Verde, and foreign investors receive the same treatment as Cabo Verdean nationals regarding taxes, licenses and registration, and access to foreign exchange. In January, the Cabo Verdean National Assembly approved a law, including fiscal incentives, that establishes conditions for investment in the country by Cabo Verdean emigrants. Foreign investment in Cabo Verde is concentrated in tourism and light manufacturing. Aligned with PEDS 2017-2021, it is the government’s goal to position Cabo Verde as a regional and international hub for both passengers and cargo, and the government is developing policies to realize this plan.

The 2019 privatization of the national airline and the creation of new routes (including a direct flight to Washington Dulles International Airport in December) had started to show positive results with number of passengers increasing 136 percent between March 2019 and February 2020. However, in financial terms, it will take several years for Cabo Verde Airlines’ financial position to stabilize, even with significant government and shareholder engagement. The government’s high public debt (projected to reach 132 percent of GDP in 2020) limits its capacity to finance any shortfalls; the government’s people-focused response to COVID-19 will further strain the government’s finances. The economy is service-oriented, with tourism, transport, commerce, and public services accounting for more than 60 percent of GDP. Tourism alone accounts for approximately 25 percent of GDP directly, and more than 40 percent indirectly. Maritime connectivity has been improving since Portugal’s Transinsular launched a new consortium in August 2019 with Cabo Verdean operators, but services are not yet at the expected efficiency and reliability levels. The government, with support from China, has been developing a plan for a maritime special economic zone that would support a range of maritime economy needs, including expanded deep-water ports and other maritime services.

The energy sector in Cabo Verde is undergoing important regulatory changes and seeking investment, which may result in a clearer framework to promote investment opportunities in the sector. As a regional leader in renewable energy, Cabo Verde already has wind farms on four islands. Currently, about 27 percent of the energy consumed in Cabo Verde comes from renewable sources; the rest comes from imported diesel. The government’s goal is to increase renewable energy production to 50 percent by 2030, which presents additional investment opportunities for American companies in this sector.

Despite recent progress, the country’s extreme vulnerability to external shocks and high dependency on tourism and imports mean that it is reeling from the COVID-19 pandemic.  Its GDP, which had been expected to achieve 5-6 percent growth in 2020, is now likely to contract by more than five percent.  In addition, Cabo Verde’s public debt is anticipated to reach 132.5 percent of GDP this year, one of the highest levels in Africa. The unemployment rate is expected to double to 20-25 percent.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 58 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 137 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 N/A https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 USD 3 420 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $1,967 2018 $1,977 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A BEA data available at https://www.bea.gov/international/direct-investment-and-multinational-enterprises-comprehensive-data 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A 2019 108.2% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: Cabo Verde’s Central Bank

NOTE: The UNCTAD data available does not match the IMF data or Cabo Verde Central Bank’s data and post is unable to reach contacts to align the data.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment 2018 Outward Direct Investment
Total Inward 2 106 100% Total Outward Amount 100%
United Kingdom 409 19.4% N/A
Portugal 392 18.6%
Spain 273 13%
Italy 120 5.7%
Ireland 46 2.2%
“0” reflects amounts rounded to +/- USD 500,000.

NOTE: Country’s data provided by Central bank does not match IMF data stated above.

Table 4: Sources of Portfolio Investment
Data not available.

Cambodia

Executive Summary

Cambodia has experienced an extended period of strong economic growth, with average annual gross domestic product (GDP) growth hovering at seven percent over the last decade, driven by growing exports (particularly in garment and footwear products), increased investment, and domestic consumption. Tourism is another large contributor to growth, with tourist arrivals reaching 6.61 million in 2019. Cambodia’s GDP per capita stood at $1,674 in 2019, while the average annual inflation rate was estimated at 3.2 percent.

The government has made it a priority to attract investment from abroad. Foreign direct investment (FDI) incentives available to investors include 100 percent foreign ownership of companies, corporate tax holidays of up to eight years, a 20 percent corporate tax rate after the incentive period ends, duty-free import of capital goods, and no restrictions on capital repatriation.

Despite incentives, Cambodia has not historically attracted significant U.S. investment. Apart from the country’s relatively small market size, there are other factors dissuading U.S. investors: corruption, a limited supply of skilled labor, inadequate infrastructure (including high energy costs), and a lack of transparency in some government approval processes. Failure to consult the business community on new economic policies and regulations has also created difficulties for domestic and foreign investors alike. Notwithstanding these challenges, a number of American companies have maintained investments in the country, and in December 2016, Coca-Cola officially opened a $100 million bottling plant in Phnom Penh.

In recent years, Chinese FDI has surged and become a significant driver of growth. The rise in FDI highlights China’s desire for influence in Cambodia, and Southeast Asia more broadly, and that Chinese businesses, many that are state-owned enterprises, may not assess the challenges in Cambodia’s business environment in the same manner as U.S. businesses. The World Bank estimates that Chinese FDI accounted for 60 percent of total FDI-funded projects in Cambodia in 2017; that share rose significantly in 2018. In 2019, FDI hit $3.6 billion – a record – with 43 percent reportedly coming from China.

Physical infrastructure projects, including commercial and residential real estate developments, continue to attract the bulk of FDI. However, there has been some increase in investment in manufacturing, including garment and travel goods factories, as well as agro-processing.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 162 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 144 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 98 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in Cambodia ($M USD, historical stock positions) 2018 USD 165 https://apps.bea.gov/international/
di1usdbal
World Bank GNI per capita 2018 USD 1,390 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics 

There has been a surge in FDI inflows to Cambodia in recent years. Though FDI goes primarily to infrastructure, including commercial and residential real estate projects, it has also recently favored investments in manufacturing and agro-processing. Cambodia reports its total stock of FDI reached $42 billion in 2019 in terms of fixed assets, up from $38.5 billion in 2018.

Investment into Cambodia is dominated by China, and the level of investment from China has surged especially the last five years. Cambodia reports that its stock of FDI from China reached $16.6 billion by the end of 2019. Other major sources of FDIs stock in Cambodia include South Korea ($4.7 billion), United Kingdom ($3.8 billion), Malaysia ($2.7 billion), and Japan ($2.4 billion), through 2019. In 2019 alone, Chinese investment in Cambodia reached $1.3 billion, followed by Hong Kong ($913 million), and the United Kingdom ($822 million).

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy 
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Cambodia Gross Domestic Product (GDP) ($M USD) 2019 $27 billion 2019 $26.7 billion www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in Cambodia ($M USD, stock positions) 2019 $1,375 2017 $517 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Cambodia’s FDI in the United States ($M USD, stock positions) N/A N/A 2017 $5 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2019 156% 2018 96.8% UNCTAD data available at
https://unctad.org/en/Pages/
DIAE/World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: The Council for the Development of Cambodia (CDC) provides official government data on investment in Cambodia, but not all data is published online. See: www.cambodiainvestment.gov.kh/why-invest-in-cambodia/investment-enviroment/investment-trend.html 

Table 3: Sources and Destination of FDI 
Direct Investment from/in Counterpart Economy Data (through 2018)
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 23,246 100% Total Outward 840 100%
China 6,786 29.2% South Africa 310 37%
Korea 1,934 8.3% China 260 31%
Vietnam 1,880 8% Singapore 225 27%
Hong Kong 1,688 7.3% Philippines 31 3.7%
Taiwan 1,629 7% Myanmar 17 2%
“0” reflects amounts rounded to +/- USD 500,000.

Data retrieved from IMF’s Coordinated Direct Investment Survey database presents a much different picture of FDI into Cambodia as compared to that provided by the Cambodian government. For example, the Council for Development of Cambodia reports $38.5 billion stock FDI in term of fixed asset through year-end 2018, while the IMF reports only $23 billion.

Table 4: Sources of Portfolio Investment
Data not available.

Cameroon

Executive Summary

Cameroon continues to implement an Extended Credit Facility from the IMF but has fallen behind on most of the reforms outlined in the agreement.  In May, the IMF approved the disbursement of a $226 million Rapid Credit Facility to support the “urgent balance of payment needs” stemming from the COVID-19 crisis.  A resurgent Boko Haram and ISIS-West Africa in the country’s Far North Region, combined with separatist violence in the Anglophone Northwest and Southwest Regions, continue to undermine Cameroon’s security and distract the government from needed economic reforms and infrastructure improvement.  In January 2020, Cameroon lost its eligibility in the African Growth and Opportunities Act due to human rights concerns.  Collapsing oil prices in early 2020 and the economic slowdown related to COVID-19 will hamper public finances and growth prospects, which will limit the government’s ability to make much-needed investments in physical infrastructure, education, and health.

Foreign investment continues to focus on extractive industries and infrastructure, most notably minerals and energy.  The government regularly calls for expanded international investment in utilities and myriad state-owned enterprises but has little appetite for removing bureaucratic impediments and tackling corruption.

Cameroon has a unique mix of natural resources and geography that make it attractive to investment.  The country shares a 1,000-mile border with Africa’s largest economy, Nigeria, and is the economic engine of the Economic and Monetary Community of Central Africa (CEMAC).  Cameroon is a bilingual country, with significant swathes of the population speaking French and English.  Continued conflict in the two Anglophone regions and the incursion of Boko Haram and ISIS-WA in the Far North undermine the country’s security.  State-owned companies with monopolistic power often function as regulators in various sectors and distort the business climate.  Cameroon struggles with rampant corruption which pervades an inefficient and slow public administration.  The result is underinvestment in infrastructure, education, and health.

Sectors that have historically attracted significant investment are:

Extractive Industry (Oil/Gas, Mining, Timber)

Cameroon has been an oil exporter since 1977.  Oil production has stagnated as prices fluctuated, but the country can count on untapped gas reserves estimated at 3.5 billion cubic meters, according to the U.S. Energy Information Administration.  The government dominates the sector and generally operates a revenue-sharing business model with foreign investors.  Cameroon also has dozens of deposits of valuable minerals, including gold, cobalt, magnesium, nickel, iron, and bauxite.  Cameroon’s immense tropical rainforests contain valuable hardwoods and softwoods.

Agriculture

The Cameroonian government has invested heavily in agriculture over the past 30 years, with minimal results.  Cameroon is often described as the breadbasket of Central Africa because it supplies foodstuffs to Nigeria and CEMAC members.  Market opportunities exist in the transformation of raw crops into finished or semi-finished products.  Access to credit, poor infrastructure, securing land rights, and ongoing fighting between separatists and government security forces in the cocoa and coffee-growing regions are significant obstacles.

Information & Communication Technology

Information and communication technology is the fastest growing economic sector in Cameroon, though internet penetration is still one of the lowest in sub-Saharan Africa.  The mobile sector is still concentrated in the hands of four companies, including the state-owned Cameroon Telecommunication (CAMTEL), which also functions as the market regulator.  Despite CAMTEL’s monopoly on the communication backbone, including underwater fiber optic cables, faster internet broadband and 3G-4G offer lucrative investment opportunities.

Banking and Finance

The financial sector of Cameroon has 15 banks, 26 insurance companies, a state pension fund, and a state-owned mortgage bank.  In addition, the country has over 400 microfinance institutions, a state-owned postal bank, and a nascent stock market based in Douala.  According to the International Monetary Fund, total financial assets represent 40 percent of national GDP, two-thirds of which is held by banks.  Less than 15 percent of Cameroonians have access to financial services.  There are investment opportunities in subsectors of the financial industry, particularly in conventional banking, risk protection, or in the increasingly popular mobile money business.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 153 of 180 https://www.transparency.org/
country/CMR
World Bank’s Doing Business Report 2020 167of 190 https://www.doingbusiness.org/
content/dam/doingBusiness/country/
c/cameroon/CMR.pdf
Global Innovation Index 2019 115 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 USD 14 https://apps.bea.gov/international/
factsheet/factsheet.cfm?Area=404&UUID
=c39e7aa0-5372-457c-95c7-c7c9e2699ca7
World Bank GNI per capita 2018 USD 1,468 https://data.worldbank.org/indicator/
NY.GNP.PCAP.KD?locations=CM

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $37,700 2018 $38,675 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $14 https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions)  N/A N/A N/A N/A
Total inbound stock of FDI as % host GDP N/A N/A 2018 18.8% https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

* Source for Host Country Data: 2019 Cameroon Finance Bill, page 13 (converted at $1=600 Central African Francs)

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Canada

Executive Summary

Canada and the United States have one of the largest and most comprehensive investment relationships in the world. U.S. investors are attracted to Canada’s strong economic fundamentals, its proximity to the U.S. market, its highly skilled work force, and abundant resources. As of 2018, the United States had a stock of USD 401 billion of foreign direct investment (FDI) in Canada. U.S. FDI stock in Canada represents 46 percent of Canada’s total investment. Canada’s FDI stock in the United States totaled US$511 billion.

The full impact of COVID-19 on Canada’s economy is yet to be seen. Private sector analysts predict Canada’s GDP will shrink between 1 and 6 percent in 2020. IMF’s April 2020 World Economic Outlook forecasts Canada’s annual GDP in 2020 will contract by 6.2 percent. A majority of small- and medium-sized enterprises are responding to steep declines in sales and mandated closures with layoffs, with more than 44 percent indicating on April 14 they might not survive should business restrictions remain in place until the end of May. Despite a rapidly changing business environment, borders and supply chains are functioning well.

U.S. FDI in Canada is subject to the provisions of the Investment Canada Act (ICA), the World Trade Organization (WTO), and the 1994 North American Free Trade Agreement (NAFTA). Chapter 11 of NAFTA contains provisions such as “national treatment” designed to protect cross-border investors and facilitate the settlement of investment disputes. NAFTA does not exempt U.S. investors from review under the ICA, which has guided foreign investment policy in Canada since its implementation in 1985. The ICA provides for review of large acquisitions by non-Canadian investors and includes the requirement that these investments be of “net benefit” to Canada. The ICA also has provisions for the review of investments on national security grounds. The Canadian government has blocked investments on only a few occasions.

The Canadian government announced April 18, 2020 enhanced scrutiny of certain foreign investments under the ICA, which will apply until the economy recovers from the effects of the COVID-19 pandemic. While all investments will continue to be examined on their own merits, the Government will scrutinize with particular attention foreign direct investments of any value in Canadian businesses that are related to public health or involved in the supply of critical goods and services to Canadians. The Government will also subject all foreign investments by state-owned investors, or investors with close ties to foreign governments, to enhanced scrutiny under the Investment Canada Act.

Canada, the United States, and Mexico signed a modernized and rebalanced NAFTA agreement – the United States-Mexico-Canada Agreement (USMCA) – November 30, 2018 and a protocol of amendment to the USMCA on December 10, 2019. President Trump signed legislation implementing the USMCA on January 29, 2020. The agreement will come into force after the completion of the domestic ratification processes by each individual member of the agreement, likely in 2020. The agreement updates NAFTA’s provisions with respect to investment protection rules and investor-state dispute settlement procedures to better reflect U.S. priorities related to foreign investment. All Parties to the agreement have agreed to treat investors and investments of the other Parties in accordance with the highest international standards, and consistent with U.S. law and practice, while safeguarding each Party’s sovereignty and promoting domestic investment.

Although foreign investment is a key component of Canada’s economic growth contributing 1.9 percent to GDP, restrictions remain in key sectors. Under the Telecommunications Act, Canada maintains a 46.7 percent limit on foreign ownership of voting shares for a Canadian telecom services provider. However, a 2012 amendment exempts foreign telecom carriers with less than 10 percent market share from ownership restrictions in an attempt to increase competition in the sector. In May 2018, Canada eased its foreign ownership restrictions in the aviation sector, which increased foreign ownership limits of Canadian commercial airlines to 49 percent from 25 percent. Investment in cultural industries also carries restrictions, including a provision under the ICA that foreign investment in book publishing and distribution must be compatible with Canada’s national cultural policies and be of “net benefit” to Canada. Canada is open to investment in the financial sector, but barriers remain in retail banking.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 12 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 23 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 17 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 $401,874 http://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 $44,940 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $1,352,603 2018 $1,713,000 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $313,069 2018 $401,874 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2018 $458,746 2018 $511,176 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 $676,064 2018 52.2% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data:

  • Host Country Source: Office of the Chief Economist, State of Trade 2019, Global Affairs Canada.
  • Host Country Source: Statistics Canada
  • Note: Data converted to U.S. dollars using yearly average currency conversions from IRS
Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 642,572 100% Total Outward 936,122 100%
United States 297,670 46% United States 436,181 47%
Netherlands 78,224 12% United Kingdom 80,149 9%
Luxembourg 40,927 6% Luxembourg 66,028 7%
United Kingdom 36,913 6% Barbados 47,521 5%
Switzerland 33,830 5% Bermuda 34,460 4%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 1,599,773 100% All Countries 1,200,859 100% All Countries 398,914 100%
United States 988,562 62% United States 717,341 60% United States 271,221 68%
United Kingdom 87,458 5% United Kingdom 68,708 6% United Kingdom 18,751 5%
Japan 62,038 4% Japan 55,151 5% Australia 10,087 3%
France 39,837 2% France 32,991 3% Germany 8,066 2%
Cayman Islands 33,899 2% Cayman Islands 29,510 2% Japan 6,887 2%

Chad

Executive Summary

Chad is Africa’s fifth largest country by geographic/surface area, encompassing three agro-climatic zones. Chad is landlocked, bordering Libya to the north, Sudan to the east, Central African Republic (CAR) to the south, and Cameroon, Nigeria, and Niger to the west (with which it shares Lake Chad). The nearest port – Douala, Cameroon – is 1,700 km from the capital, N’Djamena. Chad is one of six countries that constitute the Central African Economic and Monetary Community (CEMAC), a common market. Chad’s human development is one of the lowest in the world according to the UN Human Development Index (HDI), and poverty afflicts a large proportion of the population.

The GOC is favorably disposed to foreign investment, especially from North American companies. There are opportunities for foreign investment in Agribusiness; Agricultural, Construction, Building & Heavy Equipment; Automotive & Ground Transportation; Education; Energy & Mining; Environmental Technologies; Food Processing & Packaging; Health Technologies; Information Technology; Industrial Equipment & Supplies; Information & Communication; and Services.

Since oil production began in 2003, the petroleum sector has dominated economic activity and has been the largest target of foreign investment, including from U.S. companies. Agriculture and livestock breeding are also important economic activities, employing the majority of the population. The Government of Chad (GOC) has prioritized agriculture, livestock breeding, meat processing, energy production, and information technology in recent years in an effort to diversify the economy and lessen fiscal dependence on volatile global energy markets.

Chad’s business and investment climate remains challenging. Private sector development is hindered by poor transport infrastructure, lack of skilled labor, minimal and unreliable electricity supply, weak contract enforcement, corruption, and high tax burdens on private enterprises. Frequent border closures with neighboring countries, exacerbated by COVID-19 restrictions, complicate international trade. The COVID-19 pandemic halted Chad’s modest 2019 economic recovery following several years of recession caused by low global oil prices and large debt payments to Glencore. Existing IMF and World Bank programs aim to improve governance, increase transparency, and reduce internal arrears. Private sector financing is limited, and low GDP growth constrains government investment and private sector spending. Frequent rotations of key ministers and overzealous customs inspectors present further roadblocks.

Despite these challenges, the success of several foreign investments into Chad illustrates the business opportunities for experienced, dedicated, and patient investors. Successful investors often operate with trusted local partners to navigate the challenges of operating in Chad. The oil sector will mark 20 years of operations in 2023 and features several prominent American international oil companies. Olam International entered Chad’s cotton market in 2018 and dramatically increased national cotton production. Mindful of the imperative to enact reforms, the GOC launched a Presidential Council to Improve the Business Climate in late 2019. With rich natural resources, minimally developed agriculture and meat processing sectors, ample sunshine, increasing telecommunications coverage, and a rapidly growing population, Chad presents an opportunity for targeted investment in key sectors.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 162 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 182 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 N/A https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 USD 670 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2018 $11.273 World Bank data available at
https://data.worldbank.org/
country/chad
 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A N/A N/A BEA data available at
https://www.bea.gov/international/
di1usdbal
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $1 BEA data available at
https://www.bea.gov/international/
di1fdibal
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 55.9% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
Table 3: Sources and Destination of FDI
Data not available.
Table 4: Sources of Portfolio Investment
Data not available.

Chile

Executive Summary

As the seventh largest economy in the Western Hemisphere, Chile has historically enjoyed levels of stability and prosperity among the highest in the region. In October 2019, widespread civil unrest broke out in Chile in response to perceived systemic economic inequality. The unrest had a significant impact on Chile’s economy and some U.S. businesses operating in Chile. Pursuant to a political accord in response to the civil unrest, Chile plans to hold a plebiscite in October 2020 on whether or not to draft a new constitution. Chile’s solid macroeconomic policy framework has provided the fiscal space to respond to the economic effects of the social unrest and the COVID-19 pandemic through an economic stimulus package of about USD16.75 billion, which is expected to increase the fiscal deficit to 8 percent in 2020. Chile boasts one of the strongest sovereign bond ratings in Latin America. The country’s economy grew 1.1 percent in 2019, and the Chilean Central Bank forecasts Chile’s economic growth in 2020 will be in the range of -1.5 to -2.5 percent due to the impact of the COVID-19 pandemic.

Chile has successfully attracted Foreign Direct Investment (FDI) despite its relatively small domestic market. The country’s market-oriented policies have created significant opportunities for foreign investors to participate in the country’s economic growth. Chile has a sound legal framework and there is general respect for private property rights. Sectors that attract significant FDI include mining, finance/insurance, chemical manufacturing, and wholesale trade. Mineral, hydrocarbon, and fossil fuel deposits within Chilean territory are restricted from foreign ownership, but companies may enter into contracts with the government to extract these resources. Corruption exists in Chile but on a much smaller scale than in most Latin American countries, ranking of 26 out of 180 countries worldwide and second Latin America in Transparency International’s 2019 Corruption Perceptions Index.

Although Chile is an attractive destination for foreign investment, challenges remain. Legislative and constitutional reforms proposed in response to the social unrest and the pandemic have generated concern about the potential impact on investments in the energy, healthcare, insurance, and pension sectors. Despite a general respect for intellectual property (IP) rights, Chile has not fully complied with its IP obligations set forth in the U.S.-Chile FTA. Environmental permitting processes, indigenous consultation requirements, and cumbersome court proceedings have made large project approvals increasingly time consuming and unpredictable, especially in cases with political sensitivities. The current administration prioritizes attracting foreign investment and continues to implement measures to streamline the process.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 26 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 59 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 51 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 26,146 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 14,670 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 298,718 2018 298,238 www.worldbank.org/en/country
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country (USD million, stock positions) 2018 36,848 2018 26,146 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Host country’s FDI in the United States (USD million, stock positions) 2018 13,224 2018 3,066 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP 2018 92.4% 2018 90.3% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx

* Source for Host Country Data: Central Bank of Chile, year-end data is published in March 31 of the following year.

Table 3: Sources and Destination of FDI

According to the IMF’s Coordinated Direct Investment Survey (CDIS), total stock of FDI in Chile in 2018 amounted to USD 251.9 billion, compared to USD 274.7 billion in 2017. The United States remains the main source of FDI to Chile with USD 36.1 billion, representing 14.3 percent of the total.

The following top sources (Spain, Canada, the Netherlands, and the UK) accounted for 39.2 percent of Chile’s inward FDI stock. Chile’s outward direct investment stock in 2018 remains concentrated in South America, where Panama, Brazil, and Peru together represented 33.4 percent of total Chilean outward FDI. The United States accounted for 10.5 percent of the total.

The data below is consistent with host country statistics. Although not included in the table below, tax havens are relevant sources of inward FDI to Chile, with the British Virgin Islands, Cayman Islands and Bermuda ranking sixth, seventh and eighth in inbound sources of FDI respectively, according to the Central Bank of Chile. The Cayman Islands and Luxembourg rank eighth and ninth, respectively, among Chile´s main outward FDI destinations.

Table 3: Sources and Destination of FDI
Direct Investment from/in Chile Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 251,867 100% Total Outward 119,036 100%
United States 36,131 14.3% Panama 15,063 12.7%
Spain 35,985 14.3% Brazil 12,994 10.9%
Canada 30,888 12.3% United States 12,507 10.5%
The Netherlands 19,869 7.9% Peru 11,623 9.8%
United Kingdom 11,951 4.7% British Virgin Islands 8,787 7.4%
“0” reflects amounts rounded to +/- USD 500,000.

Table 4: Sources of Portfolio Investment

According to the IMF’s Coordinated Portfolio Investment Survey (CPIS), total stock of portfolio investment in Chile as of June 2019 amounted to USD 186.6 billion, of which USD 147.7 billion were equity and investment funds shares, and the rest were debt securities. Luxembourg (a tax haven) and the United States were the main sources of portfolio investment to Chile with US $57.9 billion and $56.9 billion, representing 31 percent and 30 percent of the total, respectively. Both countries also represent 68 percent of the total of equity investment. Ireland, the United Kingdom and Germany are the following top sources of equity portfolio investment to Chile, while the United States, Mexico and Japan are the top sources of debt securities investment.

Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 186,654 100% All Countries 147,722 100% All Countries 38,932 100%
Luxembourg 57,888 31% Luxembourg 57,526 39% United States 14,626 38%
United States 56,880 30% United States 42,255 29% Mexico 4,723 12%
Ireland 14,422 8% Ireland 14,356 10% Japan 4,064 10%
United Kingdom 6,425 3% United Kingdom 5,366 4% Germany 38,932 5%
Germany 6,319 3% Germany 4,255 3% United Kingdom 1,551 4%

China

Executive Summary

The People’s Republic of China (PRC) is the top global Foreign Direct Investment (FDI) destination after the United States due to its large consumer base and integrated supply chains.  In 2019, China made some modest openings in the financial sector and passed key pieces of legislation, including a new Foreign Investment Law (FIL).  China remains, however, a relatively restrictive investment environment for foreign investors due to restrictions in key economic sectors.  Obstacles to investment include ownership caps and requirements to form joint venture partnerships with local Chinese firms, industrial policies such as Made in China 2025 (MIC 2025), as well as pressures on U.S. firms to transfer technology as a prerequisite to gaining market access.  These restrictions shield Chinese enterprises – especially state-owned enterprises (SOEs) and other enterprises deemed “national champions” – from competition with foreign companies.

The Chinese Communist Party (CCP) in 2019 marked the 70th anniversary of its rule, amidst a wave of Hong Kong protests and international concerns regarding forced labor camps in Xinjiang.  Since the CCP 19th Party Congress in 2017, CCP leadership has underscored Chairman Xi Jinping’s leadership and expanded the role of the party in all facets of Chinese life:  cultural, social, military, and economic.  An increasingly assertive CCP has caused concern among the foreign business community about the ability of future foreign investors to make decisions based on commercial and profit considerations, rather than CCP political dictates.

Key investment announcements and new developments in 2019 included:

  • On March 17, 2019, the National People’s Congress passed the new FIL that effectively replaced previous laws governing foreign investment.
  • On June 30, 2019, the National Development and Reform Commission (NDRC) and Ministry of Commerce (MOFCOM) jointly announced the release of China’s three “lists” to guide FDI.  Two “negative lists” identify the industries and economic sectors from which foreign investment is restricted or prohibited based on location, and the third list identifies sectors in which foreign investments are encouraged.  In 2019, some substantial openings were made in China’s financial services sector.
  • The State Council also approved the Regulation on Optimizing the Business Environment and Opinions on Further Improving the Utilization of Foreign Investment, which were intended to assuage foreign investors’ mounting concerns with the pace of economic reforms.

While Chinese pronouncements of greater market access and fair treatment of foreign investment are welcome, details and effective implementation are needed to improve the investment environment and restore investors’ confidence.  As China’s economic growth continues to slow, officially declining to 6.1% in 2019 – the slowest growth rate in nearly three decades – the CCP will need to deepen its economic reforms and implementation.  Moreover, the emergence of the Coronavirus (COVID-19) pandemic in Wuhan, China in December 2019, will place further strain on China’s economic growth and global supply chains.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
Transparency International’s Corruption Perceptions Index 2019 137 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 31 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 14 of 126 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, stock positions) 2018 USD116,518 https://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 USD9,460 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S.  FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year   Amount Year Amount
Host Country Gross Domestic Product (GDP ($M USD) 2019*   $14,380,000 2018 $13,608,000 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S.  FDI in partner country ($M USD, stock positions) 2018(**)     $109,958 2018          $116,518 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2018(**)      $39,557 2018          $39,473 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total Inbound Stock as a % of GDP 2018(**) 15.9% 2018 12.1% UNCTAD data available at
https://unctad.org.en/Pages/DIAE/
World%
 

20Investment%20Report/
Country-Fact-Sheets.aspx 
 

*China’s National Bureau of Statistics (converted at 6.8 RMB/USD estimate)
**China’s 2019 Yearbook (Annual Economic Data from China’s Economic Ministries:  MOFCOM, NBS, and Ministry of Finance)

Table 3:  Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $2,814,067 100% Total Outward $1,982,270 100%
China, PR: Hong Kong $1,378,383 48.96% China, PR: Hong Kong $958,904 48.37%
British Virgin Islands $302,553 10.75% Cayman Islands $237,262 11.96%
Japan $166,817 6.13% British Virgin Islands $119,658 6.03%
Singapore $115,035 4.08% United States $67,038 3.38%
Germany $78,394 2.78% Singapore $35,970 1.81%
“0” reflects amounts rounded to +/- USD 500,000.

Source:  IMF Coordinated Direct Investment Survey (CDIS)

Table 4:  Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, US Dollars)
Total Equity Securities Total Debt Securities
All Countries $560,250 100% All Countries $303,4000 100% All Countries $256,849 100%
China, PR: Hong Kong $179,672 32.0% China, PR: Hong Kong $121,883 40.1% China, PR: Hong Kong $57,789 22.5%
Cayman Islands $47,917  8.5% Cayman Islands  $28,323  9.3% British Virgin Island  $38,230 14.8%
British Virgin Island $40,270  7.1% Luxembourg  $8,786  2.8% Cayman Islands  $19,594 7.6%
Luxembourg  $13,712  2.4% Japan  $7,012  2.3% Germany  $7,660 2.9%
Germany  $12,294  2.1% Ireland  $6,829  2.2% Singapore  $7,122 2.7%

Colombia

Executive Summary

With markedly improved security conditions, a market of 50 million people, an abundance of natural resources, and an educated and growing middle-class, Colombia continues to be an attractive destination for foreign investment in Latin America.  In the World Bank’s 2020 Doing Business Report, Colombia ranked 67 out of 190 countries in the “Ease of Doing Business” index.

In 2020, the Colombian economy will likely experience its first recession since 1999 after suffering the dual shocks of a long national quarantine to control the spread of the coronavirus and a related collapse of oil prices.  (Note: A summary of macroeconomic statistical updates due to the COVID-19 crisis is included at the end of this summary. End Note.)  However, due to strong macroeconomic institutions and relatively robust pre-coronavirus economy, Colombia is better positioned than many countries in the region to return to growth in 2021.

Colombia’s legal and regulatory systems are generally transparent and consistent with international norms.  The country has a comprehensive legal framework for business and foreign direct investment (FDI).  The U.S.-Colombia Trade Promotion Agreement (CTPA), which took effect on May 15, 2012, has strengthened bilateral trade and investment.  Through the CTPA and several international conventions and treaties, Colombia’s dispute settlement mechanisms have improved.  Weaknesses include protection of intellectual property rights (IPR), as Colombia has yet to implement certain IPR-related provisions of the CTPA.  Colombia was on the U.S. Trade Representative’s Special 301 Watch List in 2020.  The Organization for Economic Cooperation and Development (OECD) invited Colombia to join its ranks in 2018, and in April, 2020 the country became its 37th member.  With this comes the expectation Colombia will adhere to OECD norms and standards in economic operations.

The Colombian government has made a concerted effort to develop efficient capital markets, attract investment, and create jobs.  President Ivan Duque took office on August 7, 2018.  The administration made tax reform a priority, succeeding in lowering the tax obligation of some companies while extending income tax to a broader group of individuals, but has struggled to secure approval of other changes from the national congress.  Restrictions on foreign ownership in specific sectors still exist.  FDI increased 7.1 percent from 2017 to 2018, with a third of the 2018 inflow dedicated to the extractives sector.  Roughly half of the Colombian workforce in metropolitan areas is in the informal economy, a share that increases to four fifths in rural areas.  Unemployment registered at 12.6 percent in March, 2020 before rising sharply due to the COVID19 crisis.

Security in Colombia has improved significantly in recent years, with kidnappings down from 10 cases daily in 2000 to 88 cases for all of 2019.  Since the 2016 peace agreement between the government and the country’s largest terrorist organization, the Revolutionary Armed Forces of Colombia (FARC), Colombia has experienced a significant decrease in terrorist activity.  Negotiations between the National Liberation Army (ELN), another terrorist organization, and the government have stalled, and the ELN continues its attacks on energy infrastructure and security forces.  The ELN is one of several powerful narco-criminal operations that poses a threat to commercial activity and investment, especially in rural zones outside of government control.  Despite improved security conditions, coca production was at a record high in 2019.

Corruption remains a significant challenge in Colombia.  The World Economic Forum’s Global Competitiveness Index (2019) ranked Colombia 57 out of 141 countries.  The Colombian government continues to work on improving its business climate, but U.S. and other foreign investors have voiced complaints about non-tariff and bureaucratic barriers to trade and investment at the national, regional, and municipal levels.  Also of concern for investors has been ridged judicial interpretations of the right of indigenous communities to prior consultation (consulta previas) on projects within their territories, as well as a heavy reliance by the national competition and regulatory authority (SIC) on decrees to remedy perceived problems.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 96 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 67 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 67 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 $7,737 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 $6,180 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD
 COVID-19 Economic Consequences*
Measure Prior to COVID-19 With COVID-19
GDP Growth, World Bank Estimate, 2020 3.6% -2.0%
Fiscal Deficit as Percent of GDP, 2020 2.2% 4.9%
Unemployment, Fedesarrollo Estimate 10.5%
2019
16.3% – 20.5%
2020
Colombian Peso Valuation to U.S. Dollar Jan. 1, 2020
$1 = 3,287 peso
Apr. 23, 2020
$1 = 4,065 peso

* As of April, 2020

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Colombia statistical  source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Colombia Gross Domestic Product (GDP) ($B USD) 2019 $323.2 2018 $331.0 www.worldbank.org/en/country 
Foreign Direct Investment Colombia statistical  source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in Colombia ($M USD, stock positions) 2019 $2,685.7 2018 $7,737 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Colombia’s FDI in the United States ($M USD, stock positions) 2019 $35.7 N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 $188.7B 2018 56.7% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

* Data from the Colombian Statistics Departments, DANE, (https://www.dane.gov.co/ )  and the Colombian central bank (http://www.banrep.gov.co ).  Note: U.S. FDI reported by Banco de la Republica is not historically adjusted.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 26,218 100% Total Outward 47,297 100%
Panama 8,537 32.6% USA 7,737 16.4%
Chile 5,326 20.3% Spain 7,107 15.0%
Spain 4,388 16.7% Chile 6,241 13.2%
Guatemala 1,966 7.5% Netherlands 5,988 12.7%
Costa Rica 1,451 5.5% Switzerland 4,749 10.0%
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 39,602 100% All Countries 23,334 100% All Countries 16,268 100%
USA 26,888 67.9% USA 16,154 69.2% USA 10,734 66.0%
Luxembourg 4,853 12.3% Luxembourg 4,848 20.8% France 772 4.7%
Ireland 1,189 3.0% Ireland 1,183 5.1% Canada 703 4.3%
France 881 2.2% U.K. 393 1.7% Mexico 631 3.9%
U.K. 819 2.1% Germany 120 0.5% Germany 427 2.6%

Costa Rica

Executive Summary

Costa Rica is the oldest continuous democracy in Latin America with moderate but falling economic growth rates (4.2 percent in 2016 to 2.0 percent in 2019) and moderate inflation (1.5 percent through December 2019) providing a stable investment climate. The country’s relatively well-educated labor force, relatively low levels of corruption, physical location, living conditions, dynamic investment promotion board, and attractive free trade zone incentives also offer strong appeal to investors. Costa Rica’s continued popularity as an investment destination is well illustrated by strong yearly inflows of foreign direct investment (FDI) as recorded by the Costa Rican Central Bank at an estimated USD 2.5 billion in 2019 (4.1 percent of GDP).

Costa Rica has had remarkable success in the last two decades in establishing and promoting an ecosystem of export-oriented technology companies, suppliers of input goods and services, associated public institutions and universities, and a trained and experienced workforce. A similar transformation took place in the tourism sector, with a plethora of smaller enterprises handling a steadily increasing flow of tourists eager to visit despite Costa Rica’s relatively high prices. Costa Rica is doubly fortunate in that these two sectors positively reinforce each other as they both require and encourage English language fluency, openness to the global community, and Costa Rican government efficiency and effectiveness. A 2019 study of the free trade zone (FTZ) economy commissioned by Costa Rica’s investment promotion agency CINDE shows an annual 9 percent growth from 2014 to 2018, with the net benefit of that sector reaching 7.9 percent of GDP in 2018. This sector has been booming while the overall economy has been slowing for years.

The Costa Rican investment climate is threatened by a high and persistent government fiscal deficit, underperformance in some key areas of government service provision, including health care and education, high energy costs, and deterioration of basic infrastructure – ports, roads, and water systems. The ongoing COVID-19 world recession is also a major wildcard and threatens to decimate the Costa Rican tourism industry, which accounts for over 6 percent of GDP particularly in the rural areas that tourists visit and the government has always struggled to support. Furthermore, the government has very little budget flexibility to address the economic fallout and is struggling to find ways to mandate debt relief, unemployment response, and other policy solutions. On the plus side, the Costa Rican government is competently managing the crisis despite its tight budget and Costa Rican exports may prove resilient: the portion of the export sector that manufactures medical devices, for example, is facing relatively good economic prospects and companies providing services exports are specialized in virtual support for their clients in a world that is forced to move in that direction. Moreover, Costa Rica’s ongoing accession to the Organization for Co-operation and Development (OECD) has exerted a positive influence by pushing the country to address its economic weaknesses through executive decrees and legislative reforms in a process that began in 2015. Also in the plus column, the export and investment promotion agencies PROCOMER and CINDE have done an excellent job of protecting the Free Trade Zones (FTZs) from new taxes by highlighting the benefits of the regime, promoting local supply chains, and using the FTZs as examples for other sectors of the economy. Nevertheless, Costa Rica’s political and economic leadership faces a difficult balancing act over the coming years as the country must simultaneously exercise budget discipline as it faces COVID-19 driven turmoil and an ever increasing demand for improved government-provided infrastructure and services.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 44 of 180 http://www.transparency.org/research/
cpi/overview
World Bank’s Doing Business Report 2019 74 of 190 http://www.doingbusiness.org/en/
rankings
Global Innovation Index 2019 55 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 $1,625 https://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 $11,520 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $61,774 2018 $60,130 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2019 $23,551 2018 $1,625 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2019 $129 2018 $-200 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 $39,290 2018 66.6% UNCTAD data available athttps://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: Costa Rican Central Bank (BCCR). US FDI stock in Costa Rica is registered as $23,550.6 million, while CR FDI stock in the US is registered as $129.2 million.
* For 2019 GDP in dollars with National Accounts exchange rate, the Costa Rican Central Bank (BCCR) is “Host Country Statistical Source”.
*  For “Total Inbound Stock of FDI as percent host GDP”, source is UNCTAD as detailed above.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data 2018
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 39,393 100% Total Outward 3,219 100%
United States 21,749 55.2% Nicaragua 972 30.2%
Spain 2,569 6.5% Guatemala 957 30%
Mexico 1,978 5% Panama 721 22.4%
The Netherlands 1,624 4.1% United States 122 3.8%
Switzerland 1,475 3.7% Colombia 76 2.4%
“0” reflects amounts rounded to +/- USD 500,000.

Costa Rica’s open and globally integrated economy receives FDI principally from the United States followed by Europe and Latin America. Costa Rica’s outward FDI is more regionally focused on its neighbors Nicaragua, Guatemala and Panama, with the United States and Colombia following. The source of this information on direct investment positions is the IMF’s Coordinated Direct Investment Survey (CDIS) site (http://data.imf.org/CDIS).

Table 4: Sources of Portfolio Investment
Portfolio Investment Assets June 2019
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 2,768 100% All Countries 1,651 100% All Countries 1,117 100%
USA 1.838 66% USA 1,039 63% USA 798 71%
Luxembourg 313 11% Luxembourg 305 18% U.K. 87 8%
Ireland 185 7% Ireland 182 11% Colombia 29 3%
Germany 118 4% Germany 117 7% Panama 27 2%
U.K. 87 3% China P.R. 3 0% Netherlands 19 2%

The source of the information above is the IMF’s Coordinated Portfolio Investment Survey http://data.imf.org/CPIS , “Reported Portfolio Investment Assets by Economy of NonResident Issuer: Total Portfolio Investment”, from June 2019.

Côte d’Ivoire

Executive Summary

Côte d’Ivoire offers a fertile environment for U.S. investment, and the Ivoirian government is keen to deepen its commercial cooperation with the United States.  The Ivoirian and foreign business community in Côte d’Ivoire considers the 2018 investment code generous with incentives and few restrictions on foreign investors.  Côte d’Ivoire continues structural reforms to improve the business climate, including by executing major projects under the 2016-2020 National Development Plan (NDP) and the 2019-2020 social program (PSGouv).  But the ongoing COVID-19 pandemic will affect current and future investments, causing delays and postponements, cost increases, and logistics issues.

U.S. businesses operate successfully in the following Ivoirian sectors:  oil and gas exploration and production; agriculture and value-added agribusiness processing; power generation and renewable energy; IT services; digital economy; banking; insurance; and infrastructure.  In 2019, Côte d’Ivoire improved in the World Bank’s Doing Business ranking of 190 countries, moving from 122 to 110.  Improvements in the business environment included the implementation of a single taxpayer identification number system for business creation, introduction of an online case management system to process cash refunds of Value Added Tax, and making contract enforcement easier by publishing reports on commercial court performance and progress of cases.

Economically, Côte d’Ivoire is among Africa’s fastest growing economies and is the largest economy in francophone Africa.  Also home to the headquarters of the African Development Bank, Côte d’Ivoire attracts regional migrant labor and a significant expatriate professional community.  The IMF initially projected GDP growth to continue at 7.3 percent in 2020, led by growth in the industrial and service sectors. With the negative effects of COVID-19 on the country’s economic output, however, the IMF revised its projection to 2.7 percent, though still positive.

Despite improvements, doing business with the government remains a significant challenge.  The government has awarded a number of sole source contracts without competition and at times disregarded objective evaluations on competitive tenders.  An overly complicated tax system and a slow, opaque government decision-making process hinder investment.  Other challenges include weak access to credit for small businesses, corruption, and the need to broaden the tax base to relieve some of the tax-paying burden on businesses.

Following a credible and peaceful election in 2015 in which President Ouattara was overwhelmingly re-elected to a second term, the country adopted a new constitution in 2016 and established an upper legislative house (Senate) in April 2018.  Fraud and violence in certain locations marred legislative and municipal elections in 2018.  The lack of consensus in the composition of the Independent Electoral Commission, controversial reforms to the electoral code and amendments to the constitution, and the judicial exclusion of major opposition candidates from the 2020 presidential race, have aggravated the country’s internal political divisions.  On the other hand, President Ouattara’s announcement that he will not seek a third term – which, he argued, he could have done because of the new constitution – could contribute to institutionalizing democracy.

Côte d’Ivoire suffered a terrorist attack in March 2016 in the popular tourist town of Grand Bassam.  Al-Qaeda in the Islamic Maghreb claimed responsibility for this attack and continues to pose a major terrorism threat on the northern borders.  Côte d’Ivoire has since improved its domestic and international coordination efforts to combat the increasing the terrorist/violent extremist threat from the Sahel, and contributes to the United Nations peacekeeping mission in Mali.

Ivoirian women are not legally prohibited from starting businesses, acquiring credit, or buying property.  They nonetheless have historically faced discrimination, including lack of access to credit, that has hindered women’s business ownership.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 106 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 110 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 103 of  129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 -$261 https://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 $1,600 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2018 $43 billion www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 -$495 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 23.8% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
  
Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward Amount 100% Total Outward Amount 100%
France $8,428 22% Burkina Faso $1,904 19%
Canada $1,830 12% Cayman Islands $217 19%
Morocco $790 9% Liberia $205 11%
Mauritius $460 5% Mali $154 8%
United Kingdom $452 5% Senegal $152 8%
“0” reflects amounts rounded to +/- USD 500,000.

Table 4: Sources of Portfolio Investment
Data not available.

Croatia

Executive Summary

Croatia became a member of the EU in 2013, which enhanced its economic stability and provided new opportunities for trade and investment.  Croatia is accessing a substantial amount of available EU funds, but many direct benefits of EU entry are still to come.  The Croatian government pledged to take legislative and administrative steps to reduce barriers to investment, streamline bureaucracy and public administration, and program EU funds more efficiently, but it has been slow to deliver promised reforms.

The government is willing to meet at senior levels with interested investors and to assist in resolving problems.  Prime Minister Andrej Plenkovic is a former member of the European Parliament and has signaled his commitment to wide-ranging structural reforms in line with recommendations from the EU and global financial institutions. His government is working with the World Bank and other international institutions to improve the ease of doing business in Croatia and to attract investment.  Relative strengths in the Croatian economy include low inflation, a stable exchange rate, and developed infrastructure.  Historically, the most promising sectors for investment in Croatia have been tourism, telecommunications, pharmaceuticals, and banking.

Although the Croatian economy was stable ahead of the COVID-19 global epidemic, the government assessed in late April that GDP will drop by at least 9.4 percent in 2020.  Tourism directly contributes 12 percent of Croatia’s GDP and up to 20 percent when indirect contributions of the sector are included; the tourism sector is expected to suffer tremendous losses due to the COVID-19 crisis.  The COVID-19 impact is not entirely negative.  The government sped up the digitalization of many public administration services and will likely expand this effort.  The economy is burdened by a large government bureaucracy, underperforming state-owned enterprises, and low regulatory transparency, all of which contributes to poor performance and relatively low levels of foreign investment.  Following a decade of growth from the end of the war in 1995, investment activity in Croatia slowed substantially in 2008 and remained under historic levels despite the economy’s emergence from the recession at the end of 2015, relatively robust growth in 2016, and continued moderate growth through 2019.

The banking system weathered the global financial crisis well but was saddled with financial costs related to the government-mandated conversion of Swiss Franc loans into euros in 2015.

In the last three years, the government implemented a number of financial incentives and measures designed to attract investment and support entrepreneurship.  However, these incentives are not corrective for profound deficiencies in the investment climate which are predominantly linked to an inefficient, unpredictable judicial system that is slow to resolve legal disputes.  Investors continue to face high “para-fiscal” fees, rigid labor laws, and slow and complex permitting procedures for most investments.

Before the COVID-19 crisis, the government maintained a budget deficit well within EU-recommended levels, but now expects a 6.8 percent budget deficit for 2020.  In March 2020, the government announced the fourth economic reform package of PM Plenkovic’s tenure.  This package is expected to create sustainable economic growth and development, to connect education to the labor market, and to sustain public finances.  Significant structural reform is still needed.  Although the government continues to make incremental improvements to the business environment, its primary focus remains on preventing job losses from state-owned enterprises and “strategic” sectors.  In the last year, the government provided state guarantees for two major shipbuilding companies.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 63 of 180 https://www.transparency.org/
country/HRV
World Bank’s Doing Business Report 2020 51 of 190 https://www.doingbusiness.org/en/
data/exploreeconomies/croatia
Global Innovation Index 2019 42 of 128 https://www.globalinnovationindex.org/
gii-2019-report#
U.S. FDI in partner country ($M USD, stock positions) 2019 $83.4 Host government, Croatian National Bank
https://www.hnb.hr/statistics/statistical-
data/rest-of-the-world/foreign-direct-investments
World Bank GNI per capita 2018 $23,316 https://data.worldbank.org/indicator/
NY.GNP.PCAP.PP.KD?name_desc=false

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical Source* USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $60,892 2018 $60,805 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical Source* USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2019 $83.4 N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2019 $23.1 N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 58.9% N/A N/A UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
  

*GDP at www.dzs.hr  for 2019, FDI at www.hnb.hr   for Q1-Q3 2019 Note:  U.S. Bureau of Economic Analysis do not have GDP or FDI data available for 2019 at time of publishing.

Table 3: Sources and Destination of FDI
Direct Investment From/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $35,586 100% Total Outward $7,722 100%
Austria $5,028 14.1% Bosnia Herzegovina $1,410 28.6%
The Netherlands $4,667 13.1% Slovenia $1,448 21.1%
Germany $3,612 10.8% Serbia $973 14.9%
Italy $3,703 10.4% Montenegro $309 6.3%
Luxembourg $3,450 9.7% Poland $293 5.9%
“0” reflects amounts rounded to +/- USD 500,000.

*FDI at www.hnb.hr   for Q1-Q3 2019

Table 4: Sources of Portfolio Investment
Data not available.

Cyprus

Executive Summary

REPUBLIC OF CYPRUS

Cyprus is the eastern-most member of the European Union (EU), situated at the crossroads of three continents – Europe, Africa, and Asia – and thus occupies a strategic place in the Eastern Mediterranean region.

The Republic of Cyprus (ROC) eagerly welcomes foreign direct investment (FDI).  The ROC is a member of the eurozone.  English is widely spoken.  The legal system is based on UK common law.  Legal and accounting services for foreign investors are highly developed.  Invest Cyprus, an independent, government-funded entity, aggressively promotes investment in the traditional sectors of shipping, tourism, banking, and financial and professional services.  Newer sectors for FDI include energy, film production, investment funds, education, research & development, information technology, and regional headquartering.  The discovery of significant hydrocarbon deposits in Cyprus’s Exclusive Economic Zone (and in the surrounding Eastern Mediterranean region) has driven major new FDI by multinational companies in recent years.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 41 of 198 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 54 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 28 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 $4,853  https://apps.bea.gov/
international/factsheet/index.cfm
World Bank GNI per capita 2019 $27,710 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

AREA ADMINISTERED BY TURKISH CYPRIOTS

The Government of the Republic of Cyprus is the only internationally-recognized government on the island, but since 1974 the northern third of Cyprus has been administered by Turkish Cypriots.  This area proclaimed itself the “Turkish Republic of Northern Cyprus” (“TRNC”) in 1983.  The United States does not recognize the “TRNC” as a government, nor does any country other than Turkey.  A substantial number of Turkish troops remain in the northern part of the island.  A buffer zone, or “green line,” patrolled by the UN Peacekeeping Force in Cyprus (UNFICYP), separates the two parts.  The Republic of Cyprus and the area administered by Turkish Cypriots are addressed separately below.

U.S. citizens can travel to the north / Turkish Cypriot area, but as of November 2020 COVID-19 restrictions have made transit between north and south difficult for non-residents.  U.S. companies can invest in the north but should be aware of legal complications and risks due to the lack of international recognition, tensions between the two communities, and isolation of the north from the eurozone.  Turkish Cypriot businesses are interested in working with American companies in the fields of agriculture, hospitality, renewable energy, and retail franchising.  Significant Turkish aid and investment flows to the “TRNC.”  A political settlement between the communities would be a powerful catalyst for island-wide Cypriot economic growth and prosperity.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $24,5772 2018 $24,565 https://data.worldbank.org/country/CY
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $10,307 2019 $4,853 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Host country’s FDI in the United States ($M USD, stock positions) 2018 $8,878 2019 $120 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP 2018 180% 2019 1,812% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
  

* Source for Host Country Data: Eurostat

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data, 2018
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $428.4 100% Total Outward $436.8 100%
Not Specif./Confidential $169.2 39.5% Not Specif./Confidential $212.1 48.5%
Luxembourg $56.2 13.1% Russian Fed. $108.7 24.9%
Russian Fed. $51.7 12.1% British Virgin Isl. $34.6 7.9%
Jersey $38.6 9.0% Netherlands $19.9 4.5%
Netherlands $20.7 4.8% UK $15.5 3.5%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets, 2018
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries $22.4 100% All Countries $9.3 100% All Countries $13.1 100%
Russian Fed. $5.3 23.7% Russian Fed. $4.8 51.6% Luxembourg $1.2 9.2%
Luxembourg $2.3 10.3% Ireland $1.3 14.0% Ireland $0.9 6.9%
Ireland $2.2 9.8% Luxembourg $1.1 11.8% United States $0.9 6.9%
United States $1.7 7.6% United States $0.8 8.6% France $0.7 5.3%
France $0.8 3.6% Cayman Isl. $0.2 2.1% Netherlands $0.6 5.0%

Czech Republic

Executive Summary

The Czech Republic is a medium-sized, open economy with 78 percent of its GDP based on exports, mostly from the automotive and engineering industries.  According to the Czech Statistical Office, most of the country’s exports go to the European Union (EU), with 31.8 percent going to Germany alone.  The United States is the Czech Republic’s largest non-EU export partner.  In 2019, the Czech banking sector remained healthy and the economy had a stable growth of 2.4 percent of GDP.  Due to COVID-19, the Czech government predicts a 2020 GDP decline of 5.6 percent, while the International Monetary Fund predicts a 6.5 percent contraction.

The COVID-19 outbreak and resulting economic shutdown caused the Czech crown (CZK) to significantly depreciate in Q1 2020 from CZK25 to CZK27.3 per EUR and from CZK22.9 to CZK24.9 per USD from February to March 31.  The crown is fully convertible, and all international transfers of investment-related profits and royalties can be carried out freely.  While the Czech Republic meets the Maastricht criteria for adoption of the euro and agreed to join the Eurozone under the country’s EU accession agreement in 2004, the Czech government has said it will not seek to join the common currency in the next few years, a position that has broad political and public support.

The government has taken great strides since the fall of communism to open the market to competition and privatization, but the Czech Republic still lacks robust enforcement of anti-trust violations.  The Czech Republic is committed to improving transparency and reducing corruption, and protects and enforces intellectual property rights.

The government amended the bankruptcy law June 1, 2019 and again March 31, 2020.  The June 2019 amendment expanded the categories of debtors qualified for debt discharge.  The latest amendment put a moratorium on filing of bankruptcy against all companies by creditors until the end of August 2020.  The government passed the amendment to protect from bankruptcy businesses affected by COVID-19.  The amendment also suspended companies’ obligations to file for bankruptcy until February 2021 if they are not able to meet their liabilities.  The Czech Republic ranked 16th in the 2020 edition of the World Bank’s Doing Business Report for ease of resolving insolvency.

There are few restrictions on foreign investment except in certain sectors that require access to sensitive information.  The Czech government supports legislation formalizing a procedure to review foreign investments that risk compromising national security.  The bill is pending debate and approval by both houses of Parliament.  If passed as drafted, the law would allow the government to screen inbound foreign direct investment (FDI) from non-EU entities.  The Czech Republic has taken strides to diversify its traditional investments in engineering into new fields of research and development (R&D) and innovative technologies.  EU structural funding has enabled the country to open a number of world-class scientific and high-tech centers.  EU member states are the largest investors in the Czech Republic.

The Czech Republic fully complies with EU and the Organization for Economic Cooperation and Development (OECD) standards for labor laws and equal treatment of foreign and domestic investors.  While wages continue to trail those in neighboring Western European countries (Czech wages are roughly one-third of comparable German wages), they have risen about 7 to 8 percent annually over the past two years, according to the Czech Statistical Office.  Some experts believe the economic decline from the COVID-19 pandemic will dampen wage growth.  The country was facing labor shortages in 2019 with the unemployment rate hovering below 3 percent – the lowest in the EU.  However, due to the economic impact of COVID-19, the Czech Ministry of Finance predicts a rise in unemployment to 3.3 percent in 2020.  The 1992 U.S.-Czech Bilateral Investment Treaty, signed with the former Czechoslovakia, provides for international arbitration of investor–state disputes for foreign investors.

Table 1:  Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 44 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 41 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 26 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 6,737 http://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 20,240 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2:  Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $246,577 2018 $245,226 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $1,452 2018 $6,737 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2018 $686 2018 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP 2018 67% 2018 64% UNCTAD data available at

https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

*Sources:  Czech Statistical Office (www.czso.cz ), Czech National Bank (https://www.cnb.cz/cnb/obiee_pzi ).

As of 2015, the Czech National Bank records cross-border equity capital stocks for quoted shares (in line with the ESA 2010 and BPM6 international manuals) at market value instead of book value, rather than valuing FDI as the sum of historical flows, which is the methodology used by the United States.  As a result, while the 2014 figure for total U.S. FDI stock was listed at USD4.388 billion under the sum of historical flows method, under the new methodology, it is valued at USD1.567 billion.  This explains the large discrepancy between U.S. and Czech figures for 2018.

Table 3:  Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 163,155 100% Total Outward 34,905 100%
Netherlands 30,657 19% Luxembourg 9,776 28%
Luxembourg 27,018 17% Netherlands 8,614 25%
Germany 26,366 16% Cyprus 3,583 10%
Austria 16,242 10% Slovakia 2,763 8%
France 11,883 7% Romania 1,392 4%
“0” reflects amounts rounded to +/- USD 500,000.

The IMF rankings for the top five sources of FDI stock are consistent with data from the Czech National Bank.  IMF rankings for destinations of FDI stock vary – the Czech National Bank ranks the top five destinations as the Netherlands, Luxembourg, Slovakia, Cyprus, and the UK.  IMF and Czech National Bank figures for inward direct investment vary negligibly and figures for outward direct investment vary by up to 4.5 percent.  These small statistical distortions are a result of the global adoption of the recently revised OECD Benchmark Definition for FDI, which is designed to discount investment flows from special purpose entities.

The top sources and destinations of Czech FDI represent a combination of major EU trading partners and favored tax regimes.  In the early 1990s, the Netherlands became a popular place for corporate registration for domestic and foreign businesses active in the Czech Republic.  In recent years, the main rationale for registering a business in the Netherlands was favorable corporate income taxes, stimulating rapid development of offshore corporate structures in the Czech Republic.  While this has dissipated (corporate income tax rates in the Czech Republic and Netherlands are nearly equal), the Netherlands remains a popular platform for large corporations.  Luxembourg attracts Czech businesses for the same reason.  Among other FDI partner countries, Cyprus offers one of the lowest corporate income tax rates in the EU (currently 12.5 percent) and tax exemption of dividends.

Table 4:  Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, current US Dollars)
Total Equity Securities Total Debt Securities
All Countries 33,702 100% All Countries 18,735 100% All Countries 14,967 100%
Luxembourg 6,954 21% Luxembourg 5,948 32% Netherlands 2,138 14%
United States 3,567 11% United States 2,555 14% Slovakia 2,099 14%
Austria 3,367 10% Belgium 2,236 12% Austria 1,925 13%
Slovakia 2,583 8% Ireland 1,590 9% Poland 1,726 12%
Netherlands 2,359 7% Austria 1,442 8% United States 1,012 7%

The Czech National Bank does not provide its own statistical data on portfolio investments by individual countries but provides a reference to IMF data on its website.  As far as portfolio investment assets for all countries, the 2018 IMF results are consistent with the Czech National Bank’s data

Democratic Republic of the Congo

Executive Summary

The Democratic Republic of the Congo (DRC) is the second largest country in Africa and one of the richest in the world in terms of natural resources.  With 80 million hectares (197 million acres) of arable land and 1,100 minerals and precious metals, the DRC has the resources to achieve prosperity for its people.  Despite its potential, the DRC often cannot provide adequate security, infrastructure and health care to its estimated 84 million inhabitants, of which 75 percent live on less than two dollars a day.

The accession of Felix Tshisekedi to the presidency in 2019 and his government’s commitment to attracting international and particularly U.S. investment have raised the hopes of the business community for greater openness and transparency.  The DRC government is currently working with USTR to regain preferential trade preferences under the Africa Growth and Opportunity Act (AGOA).  Tshisekedi created a presidential unit to lead business reform and improve DRC’s standing of 183rd out of 190 countries in the World Bank’s Doing Business 2019 report.

The natural resource and telecommunications sectors have attracted the most foreign investment in the past.  The primary minerals sector is the country’s main source of revenue, as exports of copper, cobalt, gold, coltan, diamond, tin and tungsten provide over 95 percent of the DRC’s export revenue.  Several breweries and bottlers, a number of large construction firms, and limited textiles production are active.  The highly competitive telecommunications industry is expanding into electronic banking.  Given the vast needs, there are significant commercial opportunities in aviation, road, rail, water transport, and ports.  The agricultural and forestry sectors present opportunities for economic diversification in the DRC.

In 2019 economic growth remained sluggish, with only the extractives sector exhibiting significant growth.  After reaching 5.8 percent in 2018, economic growth slowed to 4.4 percent in 2019 owing to the drop in commodity prices.  The outbreak of the COVID-19 pandemic sent growth negative as global demand for DRC’s exports dropped.

Overall, businesses in the DRC face numerous challenges, including poor infrastructure and a weak and corrupt bureaucracy.  Armed groups remain active in the eastern part of the country, making for a fragile security situation that negatively affects the business environment.  Reform of a non-transparent and often corrupt legal system is underway.  While laws protecting investors are in effect, the court system is often very slow to make decisions or follow the law, allowing numerous investment disputes to last for years.

Table 1
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 168 of 180 http://www.transparency.org/
research/cpi/overview
World Bank Doing Business Report “Ease of Doing Business” 2019 183 of 190 https://www.doingbusiness.org/
en/data/exploreeconomies/
congo-dem-rep
Global Innovation Index 2019 N/A http://www.globalinnovationindex.org/
content/page/data-analysis
U.S. FDI in partner country ($M USD, stock positions) 2018 $80 https://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 $490 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($B USD) N/A N/A 2018 $47 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $80 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % of host GDP 2018 51.3% 2019 51.4% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 
Table 3: Sources and Destination of FDI
No detailed information is available on the IMF’s Coordinated Portfolio Investment Survey (CPIS) website and no information is available on outward direct investment from Democratic Republic of Congo.
Table 4: Sources of Portfolio Investment
No detailed information is available on the IMF’s Coordinated Portfolio Investment Survey (CPIS) website and no information is available on outward direct investment from Democratic Republic of Congo.

Denmark

Executive Summary

Denmark is regarded by many independent observers as one of the world’s most attractive business environments and is characterized by political, economic, and regulatory stability. It is a member of the European Union (EU) and Danish legislation and regulations conform to EU standards on virtually all issues. It maintains a fixed exchange rate policy, with the Danish Krone linked closely to the Euro. Denmark is a social welfare state with a thoroughly modern market economy, heavily driven by trade in goods and services. Exports account for about 55 percent of GDP. Economic conditions in its major trading partners – Germany, the United States, Sweden and the UK – have substantial impact on Danish national accounts.

Denmark is a net exporter of food, fossil fuels, chemicals and wind power, but depends on raw material imports for its manufacturing sector. Within the EU, Denmark is among the strongest supporters of liberal trade policy. Transparency International regularly ranks Denmark as having among the world’s lowest levels of perceived public sector corruption.

Denmark’s underlying macroeconomic conditions are healthy, and the investment climate is sound. Denmark is strategically situated to link continental Europe with the Nordic and Baltic countries. Transport and communications infrastructures are efficient. Denmark is among world leaders in high-tech industries such as information technology, life sciences, clean energy technologies, and shipping.

In mid-March 2020 Denmark committed up to 18% of GDP in fiscal stimulus to blunt the worst of the economic fallout from the COVID-19 pandemic. A protracted recovery is likely, and some business leaders are calling for longer-term measures to stimulate inward investment and support the export sector.

The entrepreneurial climate, including female-led entrepreneurship, is strong. Denmark expects to enact a Foreign Investment Screening mechanism in the fall of 2020 to ensure the integrity of critical infrastructure.

Note:  Separate reports on the investment climates for Greenland and for the Faroe Islands can be found at the end of this report.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 1 of 175 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 4 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 7 of 129 https://www.globalinnovationindex.org/
analysis
indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 USD 13.2 billion http://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2018 USD 60,140 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $337 billion 2018 $355 billion www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2019 $16,410 million 2018 $13,205 million BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) 2018 $25,030 million 2017 $19,150 million BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 32.6% UNCTAD data available at

https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 139,745 100% Total Outward 222,159 100%
Netherlands #1 23,130 16.6% Sweden #1 31,813 14.3%
Sweden #2 18,675 13.4% UK #2 28,050 12.6%
UK #3 13,839 9.9% Germany #3 24,043 10.8%
Luxembourgh #4 12,808 9.2% Switzerland #4 19,612 8.8%
Norway #5 12,335 8.8% United States #5 17,619 7.9%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment  
Portfolio Investment Assets 
Top Five Partners (Millions, current US Dollars) June 2019 
Total  Equity Securities  Total Debt Securities 
All Countries    532,250  100%    All Countries    318,853     100%    All Countries    213,397     100%   
United States  164,386  30.9%    United States    127,655     40%    Germany  50,529     23.7%   
Germany  61,152  11.5%    Luxembourg  37,325     11.7%    United States    36,731  17.2%   
Luxembourg  40,526  7.6%    Ireland    23,004     7.2%    Sweden    19,097  8.9%   
Ireland  30,292  5.7%    United Kingdom  20,143     6.3%    France  11,079  5.2%   
United Kingdom    29,076  5.5%    Japan  11,535     3.6%    Netherlands    9,585  4.5%   

Djibouti

Executive Summary

Djibouti, a country with few resources, recognizes the crucial need for foreign direct investment (FDI) to stimulate economic development. The country’s assets include a strategic geographic location, free zones, an open trade regime, and a stable currency. Djibouti has identified a number of priority sectors for investment, including transport and logistics, real estate, energy, and tourism. Djibouti’s investment climate has improved in recent years, which has led to interest by U.S. and other foreign firms. There are, however, a number of reforms still needed to promote investment.

In 2019, according to the UN Conference of Trade and Development, FDI stock represented 52.5% of GDP, up slightly from 52.2% in 2018. Real GDP growth has remained between 5% and a little over 8% per year for the last five years. Inflation decreased to 0.1 % in 2018 then peaked at an estimated 3.3% in 2019 and is expected to decrease in 2020. In recent years, Djibouti undertook a surge of foreign-backed infrastructure loans to posture themselves as the “Singapore of Africa.” Major projects have included a new gas terminal and pipeline to Ethiopia, a new port, improved road systems, a railroad connecting Djibouti and Addis Ababa, and a water pipeline from Ethiopia. In April 2018, the Government of Djibouti presented tax labor, and financial reforms to improve their investment climate.

Djibouti remains below regional and world averages in the World Bank’s “Doing Business” reports but has been steadily improving in recent years from 171 in 2017 to 112 (of 190 countries) in the 2020 ranking. Various business climate reforms were introduced in 2020 with the objectives of improving competitiveness both regionally and internationally. These reforms included starting online registration for companies and the creation of Djibouti Port Community System platform which is a portal that provides a comprehensive set of online services to the business community.

Economic development and foreign investment is hindered by high electricity costs, high unemployment, an unskilled workforce, regional instability, opaque business practices, compliance risks, corruption, and a weak financial sector. The World Bank estimated the government’s public debt-to-GDP ratio was 66.7 in 2019 with a projection of 69.9 % in 2020 which will gradually decrease over the years. The majority of the debt is owed to Chinese entities.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 126 of 175 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 112 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 N/A https://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2019 USD 3,540 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $3,319 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2019 52.5% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Dominica

Executive Summary

The Commonwealth of Dominica (Dominica) is located between the French territories of Guadeloupe and Martinique in the Leeward Islands chain of the Lesser Antilles. Dominica is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). Dominica had an estimated gross domestic product (GDP) of $596 million in 2019. Prior to the COVID-19 crisis, growth was forecast at 5.47 percent for 2020, according to Eastern Caribbean Central Bank (ECCB). However, the coronavirus pandemic has reduced the gains that were expected to strengthen Dominica’s economic position in the near term. Preliminary estimates by the International Monetary Fund (IMF) in April 2020 predicted that GDP would instead contract 4.7 percent.

In the World Bank’s 2020 Doing Business Report, Dominica ranked 111th out of 190 countries, compared to 103rd the previous year. Over the past three years, Dominica made paying taxes less costly by reducing the corporate income tax rate. However, the 2019 report noted that transferring property became a slower process.

Dominica continues to recover from the devastation caused by Hurricane Maria in 2017. Losses from Hurricane Maria are estimated at $1.37 billion or 226 percent of GDP. The government continues to be focused on reconstruction efforts, with support from the international community. The government is seeking to stimulate sustainable and climate-resilient economic growth through a revised macroeconomic framework that includes strengthening the nation’s fiscal framework. The government states it is committed to creating a vibrant business climate to attract more foreign investment.

Dominica remains an emerging market in the Eastern Caribbean (EC), with investment opportunities mainly within the service sector, particularly in eco-tourism; information and communication technologies; and education. Other opportunities exist in alternative energy, including geothermal energy, and capital works due to reconstruction and new tourism projects.

Recently, the government instituted a number of investment incentives. Foreign investors in Dominica can repatriate all profits and dividends and can import capital.

Dominica’s legal system is based on British common law. It does not have a bilateral investment treaty with the United States, but has bilateral investment treaties with the UK and Germany.

In June 2018, the government of Dominica signed an Intergovernmental Agreement to implement the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Dominica to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 48 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 111 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 N/A http://apps.bea.gov/
international/factsheet/
World Bank GNI per capita ($ M USD) 2018 7,090 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 453.4 2018 550.9 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 58.3% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: Eastern Caribbean Central Bank https://www.eccb-centralbank.org/statistics/dashboard-datas/ .

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Dominican Republic

Executive Summary

The Dominican Republic, an upper middle-income country, enjoyed stable, consistent growth in a relatively diversified economy in 2019, as it has over the past decade.  Foreign direct investment (FDI) provides a key source of foreign exchange for the Dominican economy, and the Dominican Republic is one of the main recipients of FDI in the Caribbean and Central America.  The government actively courts FDI with generous tax exemptions and other incentives to attract businesses to the country.  Historically, the tourism, real estate, telecommunications, free trade zones, mining, and financing sectors are the largest FDI recipients.  In January 2020, the government announced a special incentive plan to promote high-quality investment in tourism and infrastructure in the southwest region and, in February 2020, it passed a Public Private Partnership law to catalyze private sector-led economic growth.  The government’s Digital Republic program aims to create more opportunities in the digital economy for students and small businesses and ease some business operation restrictions.

Besides financial incentives, the country’s membership in the Central America Free Trade Agreement-Dominican Republic (CAFTA-DR) is one of the greatest advantages for foreign investors.   Observers credit the agreement with increasing competition, improving the rule of law, and expanding access to quality products in the Dominican Republic.  The United States remains the single largest investor in the Dominican Republic. CAFTA-DR includes protections for member state foreign investors, including mechanisms for dispute resolution.

Despite a stable macroeconomic situation, international indicators of the Dominican Republic’s competitiveness and transparency weakened over the past year.  Foreign investors report numerous systemic problems in the Dominican Republic and cite a lack of clear, standardized rules by which to compete and a lack of enforcement of existing rules.  Complaints include allegations of widespread corruption; requests for bribes; delays in government payments; weak intellectual property rights enforcement; bureaucratic hurdles; slow and sometimes locally biased judicial and administrative processes, and non-standard procedures in customs valuation and classification of imports.  Weak land tenure laws and government expropriations without due compensation continue to be a problem.  The public perceives administrative and judicial decision-making to be inconsistent, opaque, and overly time-consuming.  Corruption and poor implementation of existing laws are widely discussed as key investor grievances.

A large public corruption scandal from 2017 continues to spark calls for institutional change and was reinvigorated by new related allegations published in June 2019 in an International Consortium of Investigative Journalists report.  U.S. businesses operating in the Dominican Republic often need to take extensive measures to ensure compliance with the Foreign Corrupt Practices Act.  Many U.S. firms and investors have expressed concerns that corruption in the government, including in the judiciary, continues to constrain successful investment in the Dominican Republic.

President Danilo Medina’s July 2019 decision not to contend for re-election ensured 2020 will be a year of transition for the Dominican Republic.  The investment climate in the coming years will largely depend on whether the new government chooses to implement reforms necessary to promote competitiveness and transparency, rein in expanding public debt, and bring corrupt public officials to justice.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 137 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 115 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 87 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 $2,020 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 $7,760 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $85,536 2018 $85,555 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $2,020 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2017 $2 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 48.3% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

* Source for Host Country Data: Central Bank of the Dominican Republic (BCRD).  The BCRD does not report investment stock positions.

Table 3: Sources and Destination of FDI

No information for the Dominican Republic is available on the IMF’s Coordinated Direct Investment Survey (CDIS) website.  According to the Dominican Central Bank (BCRD), total inward flows of FDI for 2019 were $3.01 billion.  The BCRD provides a breakdown of FDI to the Dominican Republic by individual source country for the top investing countries.   The five largest investing countries accounted for 82.3 percent of total inward FDI in 2019.  Neither World Bank nor Dominican sources break down FDI from the Dominican Republic to individual destination countries

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $3,012.8 % Total Outward Amount 100%
United States $948.3 31.5 N/A N/A N/A
Mexico $640.2 21.2 N/A N/A N/A
Spain $394.3 13.1 N/A N/A N/A
Canada $258.3   8.6 N/A N/A N/A
France $237.8   7.9 N/A N/A N/A
“0” reflects amounts rounded to +/- USD 500,000.

* Source for Host Country Data: Central Bank of the Dominican Republic (BCRD), 2019 FDI inward flows.

Ecuador

Executive Summary

The Government of Ecuador under President Moreno has taken a distinct path from the policies of his predecessor, focusing on reducing the size of the public sector and its influence on the economy and seeking instead private sector investment to drive economic growth. Facing serious budget deficits, the Moreno Administration is rationalizing the size of government, merging ministries, and planning a reduction in the number of state-owned enterprises. Other cost cutting measures include reducing fuel subsidies and mandatory reductions in the number of public employees. Still, Ecuador is saddled with a very large public sector, and Moreno has committed to continue government spending on social welfare programs. To fund these programs and continue reforms, the Ecuadorian government reached in March 2019 an agreement with the International Monetary Fund (IMF) and international financial institutions for financial assistance totaling USD 10.2 billion over three years. The IMF program is in line with the government’s efforts to correct fiscal imbalances and to improve transparency and efficiency in public finance. While the March 2019 IMF program has been cancelled, the Moreno administration has opened negotiations with the IMF for a new agreement, expected to be reached in August 2020.

To increase private sector engagement in the economy and attract Foreign Direct Investment (FDI), the Ecuadorian government passed a Productive Development Law in 2018 to spur investment, has in recent years changed tax and regulatory policies for mining, and seeks to develop a Public-Private Partnership law to increase private investment in infrastructure projects. Ecuador is a dollarized economy that has few limits on foreign investment or repatriation of profits, with the exception of a five percent capital exit tax, and is actively seeking foreign investors. It has a population that views the United States positively, and the Moreno Administration has expanded bilateral ties and significantly increased cooperation with the United States on a broad range of economic, security, political, and cultural issues.

Despite these efforts, FDI inflow to Ecuador has remained very low compared to other countries in the region, due to a number of problems, most notably corruption. Ecuador is ranked in the bottom third of countries surveyed for Transparency International’s Corruption Perceptions Index. Two high-profile cases of official corruption involving the state-owned petroleum company PetroEcuador and Brazilian construction firm Odebrecht exemplify challenges that confront investors. Numerous officials have been charged for corruption related offenses, and several have been convicted, including former Vice President Jorge Glas, who was sentenced to six years in prison in December 2017. In addition, economic, commercial, and investment policies are subject to frequent changes and can increase the risks and costs of doing business in Ecuador.

Sectors of Interest to Foreign Investors

Petroleum: Per the 2008 Constitution, all subsurface resources belong to the state, and the petroleum sector is controlled by two state-owned enterprises (SOEs) that cannot be privatized. To improve efficiencies, the government may offer concessions of its refineries and is seeking ways to better target fuel subsidies. An effort to eliminate subsidies in October 2019 sparked violent civil unrest that forced the government to walk back the measure. The Ecuadorian government held a successful public tender for oil production sharing contracts (Intracampos I) in 2019 and reportedly plans to move to production sharing contracts as the standard for future tenders.

Mining: The Ecuadorian government has reduced taxes in the mining sector to attract FDI. Presidential Decree 475, published in October 2014, made minor reductions to the windfall tax and sovereign adjustment calculations. The Organic Law for Production Incentives and Tax Fraud Prevention, passed in December 2014, included provisions to improve tax stability and lower the income tax rate in the mining sector. The previous Correa administration also developed mining sector incentives such as fiscal stability agreements, limited VAT reimbursements, remittance tax exceptions, and mechanisms for companies to recover their investments before certain taxes are applied.

Electricity: The government is seeking to offer concessions to develop wind, solar, hydro and gas fired electrical generation plants to further diversify the energy matrix, as well as improve the electrical transmission connection with Peru. Non-hydro renewable energy projects in Ecuador are eligible for U.S. International Development Finance Corporation (DFC) financing.

Telecommunications: The government seeks to increase national coverage of the 4G network, as well as eventually introduce 5G into Ecuador. It plans to offer a concession of the state-owned telecommunications company CNT, as well as diversify its hardware away from Chinese vendors.

ECommerce: ECommerce sales comprise approximately one percent of Ecuadorian GDP but are a fast growing market. While many Ecuadorians are interested in purchasing online, they are limited in their ability to receive international shipments due to logistics and customs problems upon arrival in Ecuador.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 93 of 198 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 129 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 99 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, stock positions) 2018 $898 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2018 $6,110 http://data.worldbank.org/indicator/
NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($B USD) 2018 $107.4 2018 $108.4 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $898 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $30 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 17.4% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

* Source for Host Country Data: Central Bank of Ecuador. The Central Bank publishes FDI calculated as net flows only. Outward Direct Investment statistics are not published by the Central Bank.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $966.2 100% Total Outward Amount 100%
Canada $237.9 25% N/A N/A
Spain $149.6 15% N/A N/A
Netherlands $110.9 11% N/A N/A
United States $75.6 7% N/A N/A
Germany $45.1 5% N/A N/A
“0” reflects amounts rounded to +/- USD 500,000.

Source: Ecuador Central Bank, no Information available on the IMF’s CDIS website, and there is no information available on Outward Direct Investment

Table 4: Sources of Portfolio Investment
Data not available.

Egypt

Executive Summary

The Egyptian government continues to make progress on economic reforms, and while many challenges remain, Egypt’s investment climate is improving.  The country has undertaken a number of structural reforms since the flotation of the Egyptian Pound (EGP) in November 2016, and after a strong track record of successfully completing a three-year, $12 billion International Monetary Fund (IMF)-backed economic reform program, Egypt was one of the fastest growing emerging markets prior to the COVID-19 outbreak.  Increased investor confidence and the reactivation of Egypt’s interbank foreign exchange (FX) market have attracted foreign portfolio investment and grown foreign reserves.  The Government of Egypt (GoE) also understands that attracting foreign direct investment (FDI) is key to addressing many of its economic challenges and has stated its intention to create a more conducive environment for FDI.  FDI inflows grew 11 percent between 2018 and 2019, from $8.1 to $9 billion, according to data from the Central Bank of Egypt.  The United Nations Commission on Trade and Development (UNCTAD) has ranked Egypt as the top FDI destination in Africa between 2015 and 2019.

Egypt has implemented a number of regulatory reforms, including a new investment law in 2017; a new companies law and a bankruptcy law in 2018; and a new customs law in 2020.  These laws aim to improve Egypt’s investment and business climate and help the economy realize its full potential.  The 2017 Investment Law is designed to attract new investment and provides a framework for the government to offer investors more incentives, consolidate investment-related rules, and streamline procedures.  The 2020 Customs Law is likewise meant to streamline aspects of import and export procedures, including a single window system, electronic payments, and expedited clearances for authorized companies.

The government also hopes to attract investment in several “mega projects,” including the construction of a new national administrative capital, and to promote mineral extraction opportunities.  Egypt intends to capitalize on its location bridging the Middle East, Africa, and Europe to become a regional trade and investment gateway and energy hub, and hopes to attract information and communications technology (ICT) sector investments for its digital transformation program.

Egypt is a party to more than 100 bilateral investment treaties, including with the United States.  It is a member of the World Trade Organization (WTO), the African Continental Free Trade Agreement (AfCFTA), and the Greater Arab Free Trade Area (GAFTA).  In many sectors, there is no legal difference between foreign and domestic investors. Special requirements exist for foreign investment in certain sectors, such as upstream oil and gas as well as real estate, where joint ventures are required.

Several challenges persist for investors.  Dispute resolution is slow, with the time to adjudicate a case to completion averaging three to five years.  Other obstacles to investment include excessive bureaucracy, regulatory complexity, a mismatch between job skills and labor market demand, slow and cumbersome customs procedures, and various non-tariff trade barriers.  Inadequate protection of intellectual property rights (IPR) remains a significant hurdle in certain sectors and Egypt remains on the U.S. Trade Representative’s Special 301 Watch List. Nevertheless, Egypt’s reform story is noteworthy, and if the steady pace of implementation for structural reforms continues, and excessive bureaucracy reduces over time, then the investment climate should continue to look more favorable to U.S. investors.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 106 of 198 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2019 114 of 190 http://www.doingbusiness.org/
en/rankings
Global Innovation Index 2019 96 of 131 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 USD 11,000 http://apps.bea.gov/international/
factsheet/
World Bank GNI per capita 2019 USD 2,690 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $335,780 2019 $303,175 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $2,244 2019 $11,000 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 $1 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2019 41.9% UNCTAD data available at
https://unctad.org/en/Pages/
DIAE/World%20Investment%20Report/
Country-Fact-Sheets.aspx
 
 

* Sources for Host Country Data: Central Bank of Egypt; CAPMAS; GAFI

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, US Dollars, 2019)
Total Equity Securities Total Debt Securities
All Countries 985 100% All Countries 377 100% All Countries 608 100%
United States 242 25% International Organizations 216 57% United States 233 38%
International Organizations 216 22% Saudi Arabia 27 7% Saudi Arabia 92 15%
Saudi Arabia 120 12% Italy 23 6% United Arab Emirates 56 9%
United Arab Emirates 59 6% Switzerland 17 5% United Kingdom 46 8%
United Kingdom 50 5% Singapore 16 4% China 40 7%

El Salvador

Executive Summary

On June 1, 2019, President Nayib Bukele assumed office. His administration immediately pledged to eliminate cumbersome bureaucracy and improve security conditions to attract investment and create jobs. Early accomplishments included increased dialogue with the private sector and reduced homicide rates, which increased business confidence. El Salvador and the United States signed a Growth in the Americas memorandum of understanding in January 2020 to promote private investment. The COVID-19 pandemic has unfortunately complicated implementation of reforms and dampened investment.

Commonly cited challenges to doing business in El Salvador include the discretionary application of laws and regulations, lengthy and unpredictable permitting procedures, as well as customs delays. In recent years, El Salvador has lagged its regional peers in attracting foreign direct investment (FDI). The sectors with the largest investment have historically been textiles and retail establishments, though investment in energy has increased in recent years.

The Bukele administration has proposed several large infrastructure projects, which could provide opportunities for U.S. investment. Project proposals include enhancing road connectivity and logistics, expanding airport capacity and improving access to water and energy, as well as sanitation. Having inherited a large public debt from the previous administration, the Bukele administration has begun pursuing Public-Private Partnerships (PPPs) to execute infrastructure projects. El Salvador launched its first PPP in September 2019 to expand the cargo terminal at the international airport. It launched a second PPP to install highway lighting and video surveillance in January 2020. With these two PPPs, the Bukele administration delivered on its commitment under the Millennium Challenge Corporation (MCC) Compact, which is due to close in September 2020. More information about the MCC Compact is available at https://www.mcc.gov/where-we-work/program/el-salvador-investment-compact.

As a small energy-dependent country with no Atlantic coast, El Salvador relies on free trade. It is a member of the Central American Dominican Republic Free Trade Agreement (CAFTA-DR) and the United States is El Salvador’s top trading partner. Proximity to the U.S. market is a competitive advantage for El Salvador. As most Salvadoran exports travel by land to Guatemalan and Honduran ports, regional integration is crucial for competitiveness. Although El Salvador officially joined the Customs Union established by Guatemala and Honduras in 2018, the Bukele administration announced in January 2020 that it would prioritize bilateral trade facilitation with Guatemala.

The Bukele administration has taken initial steps to facilitate trade – a major priority of the textile, retail, and other U.S. companies invested in El Salvador. In July 2019, the government of El Salvador (GOES) relaunched the National Trade Facilitation Committee (NTFC), which had not met since its creation in 2017. The NTFC produced the first jointly developed private-public action plan to reduce trade barriers. The plan contains 60 strategic measures focused on simplifying procedures, reducing trade costs, and improving connectivity and border infrastructure. Companies are hopeful the plan would help reduce costs and make El Salvador more attractive for further investment.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 113 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report “Ease of Doing Business” 2019 91 of 190 http://www.doingbusiness.org/rankings
Global Innovation Index 2019 108 of 129 http://www.globalinnovationindex.org/
content/page/data-analysis
U.S. FDI in partner country ($M USD, stock positions) 2017 3,037 http://apps.bea.gov/
international/factsheet/
World Bank GNI per capita 2017 3,820 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $26,056. 94 2018 $26,057 https://data.worldank.org/
country/el-salvador
 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2018 $2,413.61 2018 $3,277 BEA data available at
https://apps.bea.gov/international/
factsheet/factsheet.cfm?Area=209
 
Host country’s FDI in the United States ($M USD, stock positions) 2018 N/A 2018 $17.0 BEA data available at
http://bea.gov/international/
direct_investment_multinational_
companies_comprehensive_data.htm
 
Total inbound stock of FDI as % host GDP 2018 9.3% 2018 126%

* Central Bank, El Salvador. In 2018, the Central Bank released GDP estimates using the new national accounts system from 2008 and using 2005 as the base year.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data (2018)*
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 9,705 100% Total Outward 2 100%
Panama 2,899 29.9% Guatemala 1 34%
United States 2,414 24.9% Nicaragua 1 44%
Mexico 895 9.2% Costa Rica 0 4%
Spain 833 8.6% Honduras 0 6%
Colombia 759 7.8%
“0” reflects amounts rounded to +/- USD 500,000.

*Coordinated Direct Investment Survey, International Monetary Fund

Table 4: Sources of Portfolio Investment
Data not available.

Equatorial Guinea

Executive Summary

The Republic of Equatorial Guinea is endowed with oil and gas resources that attracted billions of dollars in direct U.S. investment instrumental to extracting those resources. Discovery of oil in the 1990s resulted in rapid economic growth by the late 2000s. According to certain businesses, however, corruption, perceptions of a biased judiciary and a burdensome, inefficient bureaucracy undermine the general investment climate in the country. Growth has slowed as several operational oil fields have matured and are now in decline. International watchdog organizations give Equatorial Guinea one of the world’s lowest rankings in various global indices, including those for corruption, transparency, and ease of doing business. Companies have reported that these ratings underscore the challenging and opaque environment in which both local and foreign businesses must operate. The government of the Republic of Equatorial Guinea is seeking investment in several sectors: agribusiness; fishing; energy and mining; petrochemicals, plastics and composites; travel and tourism; and finance. Most of these sectors are undeveloped. The Equatoguinean domestic market is small, with an estimated population of one million, although the country is a member of the Central African Monetary and Economic Union (CEMAC) sub-region, comprising more than 50 million people. The zone has a central bank and a common currency – the CFA franc, which is pegged to the euro. Equatorial Guinea graduated from “Least Developed Country” (LCD) status in 2017 and recently reactivated its efforts to accede to the World Trade Organization. Equatorial Guinea became a full member of Organization of the Petroleum Exporting Countries (OPEC) in 2017 and is a member of the Gas Exporting Countries Forum (GECF).

The Government of the Republic of Equatorial Guinea has worked with international partners, including the World Bank (WB) and the International Monetary Fund (IMF), since March 2014 to analyze ways to improve the business climate. The government implemented some recommendations, launched a one-stop shop for investors and entrepreneurs in January 2019 and instituted certain tax exemptions and other incentives to attract investment.

Equatorial Guinea has made significant advances on the country’s Horizon 2020 social development plan, specifically in construction of infrastructure, electrification, and access to water, healthcare, and education. Equatorial Guinea expresses pride in having some of the region’s best roads and other essential infrastructure, including development of its ports and pending completion of a new airport terminal. After oil prices started dropping in 2014, the government began extending timelines for completing infrastructure projects and put many on hold as the country slumped into a recession that continued through 2019. The steep drop in oil prices in early 2020 combined with the coronavirus pandemic is expected to shrink the economy by nearly 9 percent. Investors have reported that past commercial disputes have involved delayed payment, or non-payment, by the Government of the Republic of Equatorial Guinea to foreign firms for delivered goods and services; and that certain companies exited the country with millions in unpaid bills. Some claim that much work remains, especially on diversifying the economy and improving healthcare and education.

Equatorial Guinea does not require visas for U.S. citizens. Visas may be difficult to obtain for third-country nationals, although the government created new visa categories in 2019 in an effort to speed the process. Residency and work permits can be similarly difficult to obtain or renew. In March 2018, to ease the conditions of entry and residence in the country, the government reduced the cost of permits by half. Residency and work permits were not issued regularly between 2017 and 2019, requiring expatriates to leave the country every 90 days.

Despite various challenges, U.S. businesses have mainly had success in the hydrocarbons sector. Some U.S. businesses have profited in other sectors such as technology and computer services. Various international companies continued to enter the market in 2019 and 2020 in response to new licensing rounds in the hydrocarbons and mining sectors. U.S. businesses may invest in new sectors such as telecommunications, infrastructure, agriculture, mining, and transportation.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 173 of 198 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report 2020 178 of 190 https://www.doingbusiness.org/en/data/
exploreeconomies/equatorial-guinea
Global Innovation Index 2019 N/A https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2018 $908 https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 $6,650 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2018 $13,278 https://data.worldbank.org/
country/equatorial-guinea
 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 $908 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 -$3 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2018 102.7% UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx
 

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Estonia

Executive Summary

Estonia is a safe and dynamic country for investment, with a business climate very similar to the United States. As a member of the EU, the Government of Estonia (GOE) maintains liberal policies in order to attract investments and export-oriented companies. Creating favorable conditions for foreign direct investment (FDI) and openness to foreign trade has been the foundation of Estonia’s economic strategy. The overall freedom to conduct business in Estonia is well protected under a transparent regulatory environment.

  • Estonia is among the leading countries in Eastern and Central Europe regarding FDI per capita. At the end of 2019, Estonia had attracted in total USD 27 billion (stock) of investment, of which 34 percent was made into the financial sector, 17.7 percent into real estate, 12 percent into manufacturing and 11 percent into wholesale and retail trade.
  • Estonia’s government has not yet set limitations on foreign ownership and foreign investors are treated on an equal footing with local investors, but the government is currently developing a framework to screen FDI. There are no investment incentives available to foreign investors.
  • While some corruption exists, it has not been a major problem faced by foreign investors.
  • The Estonian income tax system, with its flat rate of 21 percent, is considered one of the simplest tax regimes in the world. Deferral of corporate taxation payment shifts the time of taxation from the moment of earning the profits to that of their distribution. Undistributed profits are not subject to income taxation, regardless of whether these are reinvested or merely retained.
  • Estonia offers key opportunities for businesses in a number of economic sectors like information and communication technology (ICT), chemicals, wood processing, and biotechnology. Estonia has strong trade ties with Finland, Sweden and Germany.
  • Estonia suffers a shortage of labor, both skilled and unskilled.
Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 18 of 180 http://www.transparency.org/
research/cpi/overview
World Bank’s Doing Business Report “Ease of Doing Business” 2019 18 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 24 of 129 https://www.globalinnovationindex.org/
analysis-indicator
U.S. FDI in Partner Country ($M USD, stock positions) 2019 $393 https://statistika.eestipank.ee/
#/en/p/146/r/2293/2122
World Bank GNI per capita 2018 $21,140 http://data.worldbank.org/
indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical Source USG or International Statistical Source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $31,150 2019 $30,900 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or International Statistical Source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in Partner Country ($M USD, stock positions) 2019 $393 2018 $76 www.bea.gov 
Host Country’s FDI in the United States ($M USD, stock positions) 2019 $205 2018 N/A www.bea.gov 
Total Inbound Stock of FDI as % host GDP 2019 88% 2019 80.3% https://unctad.org/sections/dite_dir/
docs/wir2019/wir19_fs_ee_en.pdf
 
Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $27,393 100% Total Outward $10,763 100%
Sweden $6,542 24% Lithuania $2,860 26.6%
Finland $6,330 23% Latvia $2,362 22%
Netherlands $1,741 6.4% Cyprus $1,255 12%
Luxembourg $1,378 5% Finland $824 7.7%
Lithuania $1,174 4.3% Ukraine $309 2.9%
“0” reflects amounts rounded to +/- USD 500,000.
Table 4: Sources of Portfolio Investment
Portfolio Investment Assets
Top Five Partners (Millions, US Dollars)
Total Equity Securities Total Debt Securities
All Countries 15,519 100% All Countries 4,441 100% All Countries 11,078 100%
International Organizations 5,726 37% Luxembourg 1,239 28% International Organizations 5,726 52%
Luxembourg 2,374 15% U.S. 667 15% Luxembourg 1,135 10%
U.S 996 6.4% Ireland 740 16.7% Lithuania 595 5%
Ireland 802 5% Finland 368 8.3% Germany 423 4%
Finland 685 4.4% Sweden 203 4.5% France 329 3%

Source: Bank of Estonia, IMF http://data.imf.org/regular.aspx?key=60587804 

Eswatini

Executive Summary

Eswatini is a landlocked kingdom in Southern Africa. Although the official government policy is to encourage foreign investment as a means to drive economic growth, the pace of reforming investment policies is slow. Following a September 2018 general election, a new Prime Minister and cabinet (including several former CEOs and others with significant private sector experience) took office and assumed the task of turning around Eswatini’s economy. The Eswatini Investment Promotion Authority (EIPA) advocates for foreign investors and facilitates regulatory approval but lacks the political clout to achieve its core functions. Recent positive developments include the country’s January 2018 reinstatement under the African Growth and Opportunity Act (AGOA), the enactment of the Special Economic Zones (SEZ) Act and updated intellectual property legislation, and improvements in the 2019 Ease of Doing Business rankings.

The Swati government has prioritized the energy sector, particularly renewable energy, and developed a Grid Code and Renewable Energy and Independent Power Producer (RE&IPP) Policy to create a transparent regulatory regime and attract investment. Eswatini generally imports 80 percent of its power from South Africa and Mozambique. With both South Africa and Mozambique experiencing electricity shortages, Eswatini is working to increase its own energy generation using renewable sources. To that end, the country has launched a small handful of new photovoltaic projects. Information, Communications and Technology (ICT) is also an emerging sector, which Eswatini has tried to support through initiatives such as e-governance and the Royal Science and Technology Park. The digital migration program of the Southern African Development Community (SADC) presents ICT opportunities in the country.

Incentives to invest in Eswatini include repatriation of profits, fully serviced industrial sites, purpose-built factory shells at competitive rates, and duty exemptions on raw materials for manufacture of goods to be exported outside the Southern African Customs Union (SACU). Financial incentives for all investors include tax allowances and deductions for new enterprises, including a 10-year exemption from withholding tax on dividends and a low corporate tax rate of 10 percent for approved investment projects. New investors also enjoy duty-free import of machinery and equipment. SEZ investors may benefit from a 20-year exemption from all corporate taxation (followed by taxation at 5 percent); full refunds of customs duties, value-added tax, and other taxes payable on goods purchased for use as raw material, equipment, machinery, and manufacturing; unrestricted repatriation of profits; and full exemption from foreign exchange controls for all operations conducted within the SEZ.

Royal family involvement in the mining sector has discouraged potential investors in that sector. Eswatini’s land tenure system, where the majority of rural land is “held in trust for the Swati nation,” has discouraged long-term investment in commercial real estate and agriculture.

Recent legislative reforms such as the enactment of the new Public Order Act and Sexual Offenses and Domestic Violence Act have meaningfully improved the country’s legal framework. After requalifying as an AGOA beneficiary in January 2018, Eswatini turned its attention to trying to qualify for Millennium Challenge Corporation (MCC) support. To advance these efforts, the country has launched an effort to improve its relatively poor rankings on MCC indicators such as political rights, civil liberties, and business start-up.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 113 of 180 http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2019 121 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2019 Eswatini not included https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) N/A N/A https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2018 $3,930 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2018 $59.285Billion 2018 $4.711 Billion www.worldbank.org/en/country 
Table 3: Sources and Destination of FDI
No detailed information is available on the IMF’s Coordinated Portfolio Investment Survey (CPIS) website and no information is available on outward direct investment from Eswatini.
Table 4: Sources of Portfolio Investment
No detailed information is available on the IMF’s Coordinated Portfolio Investment Survey (CPIS) website and no information is available on outward direct investment from Eswatini.

Ethiopia

Executive Summary

Ethiopia’s economy is in transition. Coming off a decade of double-digit growth, fueled primarily by public infrastructure projects funded through debt, the Government of Ethiopia (GOE) has tightened its belt, reducing inefficient government expenditures and attempting to get its accounts in order at bloated state-owned enterprises (SOEs). Just in the last year, the GOE has also introduced a new and more liberal investment code, started the privatization process for the telecommunications monopoly, and eliminated numerous burdensome regulations. The IMF put the growth of the Ethiopian economy at 9 percent for FY2018/19, driven by manufacturing and services. While recent growth estimates have been revised downward due to the COVID-19 pandemic, growth prospects for Ethiopia remain better than those for most Sub-Saharan African nations. Ethiopia is the second most populous country in Africa after Nigeria, with a population of over 110 million, approximately two-thirds of whom are under age 30. Low-cost labor, a national airline with well over 100 passenger connections, and growing consumer markets are key elements attracting foreign investment.

The Government of Ethiopia (GOE) in September of 2019 unveiled its “Homegrown Economic Reform Plan” as a codified roadmap to implement sweeping macro, structural, and sectoral reform, with a focus on enhancing the role of the private sector in the economy and attracting more foreign direct investment. The ambitious three-year plan prioritizes growth in five sectors, namely mining, ICT, agriculture, tourism, and manufacturing. In December of 2019, the IMF approved a three-year, 2.9 billion U.S. dollar program to support the reform agenda. The program seeks to reduce public sector borrowing, rein in inflation, and reform the exchange rate regime.

The challenges remain vast. Ethiopia’s imports in the last three years have experienced a slight decline in large part due to a reduction in public investment programs and a dire foreign exchange shortage. Export performance remains weak, declining due to falling primary commodity prices and an overvalued exchange rate. The acute foreign exchange shortage (the Ethiopian birr is not a freely convertible currency) and the absence of capital markets are choking private sector growth. Companies often face long lead-times importing goods and dispatching exports due to logistical bottlenecks, high land-transportation costs, and bureaucratic delays. Ethiopia is not a signatory of major intellectual property rights treaties.

All land in Ethiopia is administered by the government and private ownership does not exist. “Land-use rights” have been registered in most populated areas. The GOE retains the right to expropriate land for the “common good,” which it defines to include expropriation for commercial farms, industrial zones, and infrastructure development. Successful investors in Ethiopia conduct thorough due diligence on land titles at both the regional and federal levels and undertake consultations with local communities regarding the proposed use of the land.

The largest volume of foreign direct investment (FDI) in Ethiopia comes from China, followed by Saudi Arabia and Turkey. Political instability associated with various ethnic conflicts could negatively impact the investment climate and lower future FDI inflow.

Table 1
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2019 96 of 180 https://www.transparency.org/
country/ETH
World Bank’s Doing Business Report “Ease of Doing Business” 2020 159 of 190 http://www.doingbusiness.org/rankings
Global Innovation Index 2019 111 of 129 https://www.globalinnovationindex.org/
gii-2018-report#
U.S. FDI in partner country (M USD, stock positions) 2018 $676 http://www.investethiopia.gov.et/
World Bank GNI per capita 2018