EU27 Foreign Direct Investment - Over 60% Of Investments From The Rest Of The World Into The EU27 Came From The USA In 2012

Foreign Direct Investment¹ (FDI) from the EU27² to the rest of the world reached 171 billion euro in 2012, while investment from the rest of the world into the EU27 was 159 bn in 2012. Investment from the euro area (EA17)² to the rest of the world amounted to 238 bn while investment from the rest of the world into the euro area was 193 bn.

In 2012, the main destinations of EU27 investments were the Offshore financial centres3 (18 bn euro), Canada and India (both 16 bn), the USA(15 bn), China and Hong Kong (both 10 bn) and Russia (9 bn). Disinvestments were recorded with Switzerland (-3 bn) and Japan (-2 bn).

The main investor into the EU27 was by far the USA (99 bn), followed by Canada (19 bn), Japan (8 bn), Russia and Hong Kong (both 7 bn). Disinvestments were registered with Switzerland (-6 bn), India (-3 bn) and Brazil 
(-1 bn).

These figures4, published by Eurostat, the statistical office of the European Union, come from the first FDI results for 2012.

1. Foreign direct investment (FDI) is 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). FDI flows presented here include re-invested earnings.

2. The EU27 includes Belgium, Bulgaria, the Czech Republic, Denmark, Germany, Estonia, Ireland, Greece, Spain, France, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Hungary, Malta, the Netherlands, Austria, Poland, Portugal, Romania, Slovenia, Slovakia, Finland, Sweden and the United Kingdom.

The euro area (EA17) includes Belgium, Germany, Estonia, Ireland, Greece, Spain, France, Italy, Cyprus, Luxembourg, Malta, the Netherlands, Austria, Portugal, Slovenia, Slovakia and Finland.

1. Offshore Financial Centres (OFC) is an aggregate used in Eurostat FDI data which includes 38 countries. As examples, the aggregate contains European financial centres, such as Liechtenstein, Guernsey, Jersey, the Isle of Man, the Faroe Islands, 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.

2. The figures presented for 2012 are estimates based on annualised quarterly Balance of Payments data from the Member States as of May 2013. Updated detailed figures will be released by the end of 2013. Data for the EU aggregate take into account confidential data, estimates for Member States missing data and data for Special Purpose Entities (SPEs), that are additionally collected by Eurostat and the ECB from Member States not including SPEs’ FDI in national data. This ensures adherence to international standards, exhaustiveness of the EU aggregates and explains why the total of Member States’ flows differs from the EU aggregates. 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.