August 29, 2016, from US Korea Connect: http://www.uskoreaconnect.org/blog/2016/08/growing-the-u-s-economy-through-korean-fdi-2/
In our increasingly globalized marketplace, international trade plays a central role for a country. Free trade agreements like the Korea-U.S. Free Trade Agreement (KORUS FTA) help foster trade, but true success comes when foreign businesses decide to invest in a trading partner. Foreign direct investment (FDI) strengthens relations between nations by deepening economic ties and strengthens the U.S. economy. Recently-released data from the Bureau of Economic Analysis (BEA) shows that the United States is the top destination for FDI and the total dollar amount of FDI in the United States reached a record $3.1 trillion in 2015.The United States offers many benefits to foreign companies interested in investing here.
As a stable, well-governed and transparent economy, the U.S. allows foreign companies to take advantage of industry clusters, research and development opportunities, raw materials as well as locating closer to their end markets. According to the Organization for International Investment (OFII), U.S. subsidiaries of global companies employ 6.1 million Americans, which is 5 percent of private sector employment. To build and equip their U.S. operations, foreign-based companies spend an annual $201 billion on facilities construction and new equipment. They also reinvest around $100 billion annually into their U.S. operations.
In addition, free trade agreements play a significant role when companies consider locations for foreign investments. Countries with multiple FTAs, like the United States, are more desirable for FDI because these trade agreements open the door for globally-owned companies to export their products duty free to many other markets around the world. It also helps companies to mobilize funds and increase capital flows which would help create more jobs and investment in the United States. Foreign-owned companies in the U.S. generated more than one-fifth of all U.S. exports which amounted to $360 billion in 2013.
A growing number of Korean-owned companies are finding success through investments in the United States under the KORUS FTA. This year Lotte Chemical broke ground on a $3 billion ethane cracking facility and a monoethylene glycol plant in Louisiana, an investment that locates the company closer to the industries that use their products. Korean-owned companies like Hankook Tire, Hyundai, Kia, Samsung, and Wells Lighting have also built plants in the United States to supply established industries here and to be closer to their end markets. Samsung, which currently employs more than 15,000 people across the country, recently announced an additional $1.2 billion investment for research and development in the Internet of Things. Others, like Quietside, have taken advantage of the benefits of the KORUS FTAand built their businesses in the United States.
For Korean companies interested in investing in the United States there are many resources available to ease the process. These organizations provide prospective companies with data and research they need to make investment decisions; connect companies with the right people at the state and local level; and help organizations navigate the federal regulatory system. At the Federal level, the U.S. Economic Development Administration and SelectUSA lead the charge in fostering business investment in the United States. Many states, regions and counties have economic development offices (EDO) dedicated to attracting FDI. These organizations are an indispensable resource for any foreign company interested in coming to the United States.
Foreign direct investment plays a critical role in growing the U.S. economy by creating jobs and building communities. It also helps strengthen the economic relationship between the two nations through political and institutional cooperation, improving both economies simultaneously.
In addition, free trade agreements play a significant role when companies consider locations for foreign investments. Countries with multiple FTAs, like the United States, are more desirable for FDI because these trade agreements open the door for globally-owned companies to export their products duty free to many other markets around the world. It also helps companies to mobilize funds and increase capital flows which would help create more jobs and investment in the United States. Foreign-owned companies in the U.S. generated more than one-fifth of all U.S. exports which amounted to $360 billion in 2013.
A growing number of Korean-owned companies are finding success through investments in the United States under the KORUS FTA. This year Lotte Chemical broke ground on a $3 billion ethane cracking facility and a monoethylene glycol plant in Louisiana, an investment that locates the company closer to the industries that use their products. Korean-owned companies like Hankook Tire, Hyundai, Kia, Samsung, and Wells Lighting have also built plants in the United States to supply established industries here and to be closer to their end markets. Samsung, which currently employs more than 15,000 people across the country, recently announced an additional $1.2 billion investment for research and development in the Internet of Things. Others, like Quietside, have taken advantage of the benefits of the KORUS FTAand built their businesses in the United States.
For Korean companies interested in investing in the United States there are many resources available to ease the process. These organizations provide prospective companies with data and research they need to make investment decisions; connect companies with the right people at the state and local level; and help organizations navigate the federal regulatory system. At the Federal level, the U.S. Economic Development Administration and SelectUSA lead the charge in fostering business investment in the United States. Many states, regions and counties have economic development offices (EDO) dedicated to attracting FDI. These organizations are an indispensable resource for any foreign company interested in coming to the United States.
Foreign direct investment plays a critical role in growing the U.S. economy by creating jobs and building communities. It also helps strengthen the economic relationship between the two nations through political and institutional cooperation, improving both economies simultaneously.
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