When a nation or a business invests in a foreign country, the results can include more jobs and a higher standard of living. So it’s good news that more countries are welcoming foreign investments, and taking steps to attract investment, like clamping down on corruption, lifting trade barriers and helping startups.
That’s according to annual investment-climate assessments of over 170 countries conducted by U.S. embassies and missions.
The reports help U.S. businesses decide whether and where to invest overseas. A new, online comparison tool gives people everywhere a sense of where their nation stands in attracting new business investment.
While there is a general business climate improvement, it is not universal. Thirty-four percent of U.S. embassies and missions report improvements in their countries, while 25 percent say conditions have deteriorated. (Forty-one percent indicated they stayed the same.)
Ongoing concerns include corruption, weak contract enforcement, poor intellectual property rights enforcement, and inadequate infrastructure.
The biggest improvements have been in Africa and in the East Asia and Pacific region, where nearly half the reports show a better investment climate, including easier registration for new businesses.
“While the survey indicated a large number of economies improving investment climates … our experts overseas highlighted the greatest concern about opaque regulatory environments,” the State Department’s Bureau of Economic and Business Affairs writes in an overview.
How important is direct investment by foreign companies for developing countries? In 2014, USAID, its British counterpart, and other development agencies gave these countries $137 billion in assistance. Foreign direct investment: nearly five times as much.