Net foreign direct investment
(FDI) stocks held in the rest of the world by investors resident in the European Union (EU) amounted to €7 412
bn at the end of 2017, down by 4.8% compared with the end of 2016. Meanwhile,
investment stocks held by the rest of the world in the EU remained almost stable at €6 295 bn at the end of 2017
(-0.3%). In other words, the EUˈs net investment position vis-a-vis the rest of the world decreased from €1 469 bn at the end of 2016 to €1 117 bn at the end of 2017.
Special Purpose Entities (SPEs) resident in the EU maintained their strong role in FDI, accounting for 48.7% of the total EU FDI stocks held abroad and for 59.7% of the FDI stocks held by the rest of the world in the EU, compared with 49.9% and 60.0% respectively in 2016.
These data, subject to revision, are issued by Eurostat, the statistical office of the European Union. FDI stocks help to quantify the impact of globalisation and measure longstanding economic links between countries (according to immediate counterpart criteria). They provide an indication of the relative importance of a country’s economic presence abroad, or that of foreign partners in the reporting entity, measured in terms of FDI capital.
EU and US markets remain highly interconnected
At the end of 2017, the United States absorbed 34.7% of the total FDI stocks held by the EU in the rest of the world (€2 569 bn), far ahead of Switzerland (€979 bn or 13.2%), China (€328 bn or 4.4%), Brazil (€324 bn or 4.4%), Canada (€305 bn or 4.1%), and Bermuda (€304 bn or 4.1%).
In the reverse direction, United States’ direct investors accounted for 34.7% (€2 184 bn) of the total FDI stocksheld by the rest of the world in the EU at the end of 2017. They were followed by those from Switzerland (€802 bn or 12.7%), the offshore financial centres of Bermuda (€572 bn or 9.1%), Jersey (€306 bn or 4.9%) and Cayman Islands (€300 bn, or 4.8), as well as Canada (€293 bn or 4.7%).
Share of FDI stocks held by the EU in the rest of the world, end of 2017
Share of FDI stocks held by the restof the world in the EU, end of 2017
Foreign Direct Investment stocks by partner, end of 2017
The European Union (EU) includes Belgium, Bulgaria, Czechia, Denmark, Germany, Estonia, Ireland, Greece, Spain, France, Croatia, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Hungary, Malta, the Netherlands, Austria, Poland, Portugal, Romania, Slovenia, Slovakia, Finland, Sweden and the United Kingdom.
Maghreb countries include Algeria, Morocco and Tunisia.
Gulf Arabian countries include Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates and Yemen.
NICs2 Asia (Asian NICs of the second wave of industrialisation) include Malaysia, Philippines and Thailand.
Offshore Financial Centres (OFC) is an aggregate which includes 40 countries. As examples, the aggregate contains European financial centres, such as Liechtenstein, Guernsey, Jersey, the Isle of Man, Andorra and Gibraltar; Central American OFC such as Panama and Caribbean islands like Bermuda, the Bahamas, the Cayman Islands and the Virgin Islands; and Asian OFC such as Bahrain, Hong Kong, Singapore and Philippines. Therefore, the countries included in the OFC aggregate are also included in the corresponding continental aggregate.
Methods and definitions
The main methodological reference used for the production of statistics on foreign direct investment stocks is the International Monetary Fund (IMF)’s sixth balance of payments manual (BPM6).
Foreign direct investment (FDI) stocks denote the value of the investment at the end of the period. FDI are the category of international investment that reflects the objective of obtaining a lasting interest by an investor in one economy in an enterprise resident in another economy. The lasting interest implies that a long-term relationship exists between the investor and the enterprise, and that the investor has a significant influence on the way the enterprise is managed. Such an interest is formally deemed to exist when a direct investor owns 10% or more of the voting power on the board of directors (for an incorporated enterprise) or the equivalent (for an unincorporated enterprise).
Special Purpose Entities (SPEs) are mainly financial holding companies, foreign-owned, and principally engaged in cross-border financial transactions, with no or negligible local activity in the Member State of residence. Data on FDI held abroad by resident SPEs and by the rest of the world in resident SPEs are only available for some selected partner countries, for the Offshore Financial Centres aggregate and for the Total Extra-EU aggregate.
Revisions and time table
The figures presented in this news release correspond to the latest annual FDI data transmission by the EU Member States. Data for the EU aggregate take into account confidential data and estimates for Member States missing data. This ensures adherence to international standards and exhaustiveness of the EU aggregates. The annual data covered in this News Release will be updated in one year’s time when revised data will be transmitted by Member States.