impact of the last economic recession
TRANSCRIPT
IMPACT OF THE LAST ECONOMIC RECESSION
YULIA MALUEVA, Graduate Research Assistant
Presentation Point
Faculty mentor: Lucyna Kornecki, PhD, Associate Professor in College of Business Embry Riddle Aeronautical University (ERAU)
Introduction
United States Inward and Outward FDI
• U.S. FDI Stock comparing to World Foreign Direct Investment • U.S. Outward FDI as a % of Gross National Product • U.S. Outward FDI Employment • U.S. Outward FDI financial structure • Geographical distribution • Sectoral distribution
United States Outward FDI
• Ranking by revenue • Mergers and Acquisitions, and Greenfield Projects
Multinational Corporations (MNCs)
Conclusion
AGENDA
Page 2 U.S. Outward FDI Profile
Introduction
Page 3
Globalization
The World We Live In
Multinational Corporations
Foreign Direct Investment
U.S. Outward FDI Profile
Page 4
U.S. Inward and Outward FDI
U.S. Outward FDI Profile
0
1,000
2,000
3,000
4,000
5,000
6,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Billi
ons
of D
olla
rs
Inward United States FDI Outward United States FDI
28%
-30% 22%
-41%
Page 5
U.S. Outward FDI
U.S. Outward FDI Profile
U.S. Stock comparing to World FDI
0
5,000
10,000
15,000
20,000
25,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
US
dolla
rs, i
n bi
llion
s
World and US outward FDI stock, 2000-2011
World United States
$ 19,273 billion
$ 5,275 billion
-15%
-41%
Page 6
U.S. Outward FDI
U.S. Outward FDI Profile
World Outward FDI Stock
25%
3%
4%
51%
13% 2% 2%
Average World FDI stock, 2000-2011
United States
Canada
Japan
European Union
Developing economies
Transition economies
Other developed economies
European Union includes countries of Old and New Europe Developing economies: Africa, Central and South Americas, Asia (including India, China, etc.), and Oceania Transition economies include most of Commonwealth of Independent States countries
Page 7 U.S. Outward FDI Profile
U.S. Outward FDI As a percent of Gross National Product
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
GNP 9,989 10,338 10,691 11,211 11,945 12,720 13,450 14,152 14,460 14,117 14,708 15,328
Outward FDI flows 143 125 135 129 295 15 224 394 308 267 304 397
OFDI flows % of GNP 1.4% 1% 1% 1% 2% 0.12% 1.7% 2.8% 2% 1.9% 2% 2.6%
Outward FDI stock 2,694 2,315 2,023 2,729 3,363 3,638 4,470 5,275 3,102 4,287 4,767 4,500
OFDI stock % of GNP 27% 22% 19% 24 % 28% 28.6% 33% 37% 21% 30% 32% 29%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
United States outward FDI flows and stock as percentage of US GNP, 2000-2011
OFDI flows % of GNP
OFDI stock % of GNP
Page 8 U.S. Outward FDI Profile
U.S. Outward FDI Financial Structure
-100
0
100
200
300
400
500
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Billi
ons o
f Dol
lars
The financial structure of the United States Capital outflows by component
Equity Intercompany debt Reinvested earnings
Page 9 U.S. Outward FDI Profile
U.S. Outward FDI Financial Structure
-100
0
100
200
300
400
500
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
US
$, in
bill
ions
U.S. Direct Investment Income and reinvested earnings
Reinvested earnings Direct investment income
71%
Page 10 U.S. Outward FDI Profile
U.S. Outward FDI Employment (jobs created abroad)
5,221
919
800
733
689
601
563
309
283
72
774
0 1,000 2,000 3,000 4,000 5,000 6,000
Manufacturing
Retail trade
Wholesale trade
Accommodation and food services
Administration and management
Professional, scientific, and technical services
Information
Finance and insurance
Transportation and warehousing
Real estate and rental and leasing
Other industries
Average Outward US FDI Employment by Industry (in thousands), 2000-2010
Total: 13,000,000 jobs
Page 11 U.S. Outward FDI Profile
U.S. Outward FDI Geographical Distribution (regions)
8%
57%
16%
2%
1%
16%
Geographical distribution of U.S. outward FDI flows (average) 2000-2011
North America: CanadaEuropeLatin AmericaAfricaMiddle EastAsia and Pacific
Page 12 U.S. Outward FDI Profile
U.S. Outward FDI Geographical Distribution (countries)
15%
8%
8%
12%
6% 5% 3% 4%
39%
Geographical distribution of U.S. FDI flows (average) 2000-2011. Top 8 countries
Netherlands
Luxembourg
Canada
United Kingdom
Ireland
Bermuda
Australia
Switzerland
Other countries
Page 13 U.S. Outward FDI Profile
U.S. Outward FDI Sectoral Distribution (industries)
93
43
35
15
15
6
7
14
0 10 20 30 40 50 60 70 80 90 100
Holding companies
Manufacturing
Finance
Wholesale trade
Mining
Information
Real estate
Other industries
Billions of Dollars
Sectoral distribution of U.S. outward FDI flows (average) 2000-2011
Page 14
TOP 10 MNCs
Rank 2011 MNC Name Industry Revenue US $ billion 1 Exxon Mobil Petroleum Refining 453 2 Wal-Mart Stores General Merchandisers 447 3 Chevron Petroleum Refining 246 4 ConocoPhillips Petroleum Refining 237 5 General Motors Motor Vehicles and Parts 150 6 General Electric Diversified Financials 148 7 Berkshire Hathaway Insurance 144 8 Ford Motor Motor Vehicles and Parts 136 9 Hewlett-Packard Computers 127 10 AT&T Telecommunications 126
U.S. Outward FDI Profile
Page 15 U.S. Outward FDI Profile
U.S. Outward FDI Number of Mergers & Acquisitions and Greenfield Projects
- 2 000 4 000 6 000 8 000
10 000 12 000 14 000 16 000 18 000 20 000
2003 2004 2005 2006 2007 2008 2009 2010 2011
M & A Greenfield Projects
CONCLUSION
Page 16 U.S. Outward FDI Profile
The role of the United States in Global Economy is enormous
U.S. economy is “the engine” of the world economy, and a driver of global growth
U.S. Outward Foreign Direct Investment was highly affected by economic recession of 2007
Starting from 2009 U.S. outward foreign direct investment grew up reflecting the
nascent economic recovery from the impact of the economic recession.
How To Win The Market Page 17
DISCUSSION
U.S. Outward FDI Profile
UNCTAD’s FDI/TNC database, available at: www.unctad.org/fdistatistics
United States Department of Commerce, Bureau of Economic Analysis, FDI database, available at www.bea.gov/international
Fortune magazine, available at: http://money.cnn.com/magazines/fortune/fortune500/2012/snapshots/387.html
UNCTAD/Erasmus University database; www.unctad.org/wir or www.unctad.org/fdistatistics.
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