CRASH AND RESTART Cross-border investment in the global and Swedish economy - Business Sweden
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CRASH AND RESTART Cross-border investment in the global and Swedish economy
FOREWORD
Early in the coronavirus pandemic, it became clear that companies worldwide
would put their investments on hold. Any commitments to future ventures were
suddenly deemed too risky. This was particularly the case for companies’ efforts
to establish themselves in foreign markets. Set up a new manufacturing facility
near key customers? Hardly plausible, given that demand had hit rock bottom
with no light on the horizon. What about acquiring a competitor company?
How do you do that when you can’t even travel to evaluate the factory premises.
Business Sweden’s report Crash and restart provides an account of last year’s
collapse in cross-border direct investment. It was the year when foreign invest-
ment dried up as Europe went into lockdown. It was also the year when Asia
managed to curb the spread of the infection and keep investments going, while
North America fell back as an investment region.
The report also highlights the turnaround and uptick in investments. Already LENA SELLGREN
after the summer of last year, companies restarted their investment plans. The Chief Economist
Business Sweden
M&A market gained momentum with players who forged relationships in
virtual negotiations. Optimism returned following a wave of increased demand
and the remarkably short lead time for new coronavirus vaccines.
It is always difficult to make forecasts and especially for something as
volatile as foreign direct investment. But with guidance from the UN agency
U NCTAD’s recently published statistics, the prediction is that global
investments will recover by 15 per cent this year and 20 per cent in 2022, which
today seems plausible.
The report concludes with Business Sweden’s future outlook and a few
deep-dives in the most likely scenario over the next three years.
Lena Sellgren
Chief Economist
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 2KEY DEVELOPMENTS
The coronavirus pandemic and its aftermath caused a sharp drop of 35 per cent in cross-
border direct investment in 2020. Investments fell to USD 999 billion from USD 1,530 billion
the year before.
In Europe, foreign direct investment (FDI) dropped by 77 per cent to USD 97 billion.
In Asia, investments declined by just under 2 per cent to USD 540 billion, while North
America experienced a 39 per cent drop to USD 209 billion.
Asia received half of last year’s FDI, but investors continue to have the largest presence
in Europe.
As the pandemic subsides, cross-border direct investment is expected to increase by 15 per
cent this year and 20 per cent in 2022.
FDI in Sweden amounted to SEK 240 billion by 2020, which is more than a doubling from
the previous year. This is a preliminary figure that will most likely be revised downwards.
In total, FDI stock in Sweden amounted to SEK 3,170 billion. The services sector accounts
for 60 per cent of foreign assets and the manufacturing industry for 40 per cent.
Nordic and other European companies account for 87 per cent of FDI stock in Sweden.
North American companies hold 7 per cent of the assets, while the share of Asian companies
has grown to 5 per cent.
Cross-border direct investment are financial transactions that companies carry out to start and
acquire business operations or conduct operations in already established subsidiaries in countries
other than where the companies are domiciled. Direct investment is usually characterized by a
long-term perspective and a large degree of ownership control.
Data on foreign companies’ investments in Sweden (foreign direct investment, FDI) and Swedish
companies’ investments abroad (outward direct investment, ODI) are collected by Statistics
Sweden on behalf of the Riksbank as part of the basis for the balance of payments. In Statistics
Sweden’s quarterly and full year accounts, direct investments are allocated to the three investment
types equity capital, intra-company loans and reinvested earnings. The amounts indicate the
foreign companies’ activities in Sweden and the Swedish companies’ activities abroad. Still, they
cannot directly link to the companies’ acquisitions of business operations or investments in
buildings, facilities, machinery or equipment. The figures for a current year are also often changed
through later revisions.
For a more detailed description of FDI statistics, see Business Sweden’s report When companies
invest (2018). To simplify the presentation, direct investments are referred to in this report as
investments. All amounts and calculation data are in current prices.
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 3GLOBAL CROSS-BORDER
DIRECT INVESTMENT
MANY REASONS TO The overall business motives behind companies’
ESTABLISH ABROAD foreign establishments are opportunities for
Most companies worldwide orient their operations increased revenues, reduced costs and better risk
and sales to the domestic market, but a growing management. Several factors often come into play
proportion of companies also export their goods when companies decide to establish abroad, but
and services abroad. In addition, many companies they carry varying weight in different industries
that find export sales to be limiting see new and situations, see Business Sweden’s report Taking
business potential in establishing their business manufacturing to new frontiers (2021).
in foreign markets with subsidiaries that perform
various tasks. They are usually large, resourceful INVESTMENT RISE LEVELS OFF
multinational companies with roots in developed The 1990s ushered in a favourable period for world
economies in the three major production regions trade and foreign direct investment. The comple-
of Europe, North America and Asia. tion of the Uruguay Round by the newly formed
A local sales company can strengthen the com- WTO (World Trade Organization) resulted in
pany’s brand and deepen the business relation- a broad dismantling of trade barriers. Political
ship with foreign customers. An R&D centre can and economic integration in the EU progressed.
be located to take advantage of the excellence After the Cold War, there was almost a global
of a prominent university. A local manufactur- consensus on the importance of open markets and
ing facility can provide a more accurate adapta- an attractive business climate. The financial sector
tion of the company’s products to an important was deregulated and expanded. The world market
market. It can reduce lead times and transport for goods and services grew rapidly.
costs or secure access to renewable energy, nat- New roads, rail links, ports and airports gave
ural resources and intermediate goods and ser- companies the conditions to smoothly transport
vices. The acquisition of a large company can goods and establish their operations in emerging
expand the product portfolio and provide a com- markets, where China and the countries of South-
petitive edge at the global level. The acquisition of east Asia soon took the lead. Companies were
a smaller company can give the company access to given opportunities to coordinate their interna-
interesting patents and innovations. tional operations with IT-based business support
INVESTMENTS GO INTO FREE FALL
Global cross-border direct investment 1995–2020, USD billion
2,500
Business Acquisition-driven recovery
supercycle
2,000
Rapid Globalisation loses
globalisation momentum
1,500
The European -35%
debt crisis 2020
1,000
The global The coronavirus
financial crisis pandemic
500
The dotcom-
crash
0
95
96
97
98
99
00
01
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20
19
20
20
20
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20
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20
19
20
20
19
20
19
19
20
20
20
20
20
Sources: UNCTAD, Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 4systems and telecommunications and finance abroad, so-called reshoring. China invests heavily
their investments in an increasingly international- in building its own supply chains and becoming
ised financial market. The first peak in the devel- independent of foreign expertise, for example in
opment of cross-border direct investment was the production of advanced microchips.
reached in 2000. Another influencing factor is that an increasing
The rise was punctured the following year by number of multinationals are pure service com-
the so-called dotcom crash, which led to a sharp panies. Their production often takes place locally
downward revision of many companies’ mar- and does not necessarily require large investments.
ket value and contributed to a deteriorating eco- FDI in capital-intensive businesses such as the
nomic situation, primarily in the United States processing industry has declined in recent years.
and Europe. The companies’ establishments abroad may
Even before China’s WTO membership in also have become more challenging to capture in
2001, the country had been a major destination for the statistics, partly due to increasingly advanced
American and European companies, many estab- financial arrangements, for example in M&A
lishing local operations to produce goods at low dealmaking. The internationalisation of capi-
cost and export to markets in the West. Over the tal markets has facilitated local financing, with
next decade or so, low costs were the most impor- loans and other transactions not being registered
tant determinant of industrial companies’ loca- as FDI. Various forms of business collaborations
tion of manufacturing facilities. European compa- and partnerships have also emerged as an attrac-
nies discovered Eastern Europe, while American tive alternative to capital investments.
companies went to Mexico. The rapid growth of
world trade during the period reflects how increas- STANDSTILL DURING THE PANDEMIC
ing volumes of intermediate goods were gradually Cross-border direct investment fell by 35 per cent
refined through processing at facilities in many in 2020 compared to the previous year, to USD
different countries. The geographical fragmenta- 999 billion from USD 1,530 billion. The reason for
tion of manufacturing and a wave of major cor- this is obvious as the global economy was para-
porate acquisitions contributed to a new peak in lysed by national and local restrictions imposed
cross-border direct investment in 2007. to prevent the spread of the new coronavirus. The
The global financial crisis led to a dramatic effects on companies’ propensity to invest and
decline in the world economy. Companies were expand abroad were most significant during the
forced to reconsider their plans for international first half of the year. Surveys conducted by global
expansion. Financing opportunities deteriorated consulting companies showed that more than
as banks and other financial players reoriented half of the respondent companies paused their
towards the domestic market. Planned company ongoing acquisition processes. Business Sweden’s
acquisitions stalled. The decline in cross-border own surveys showed that 60 per cent of Swedish
investment was still not so steep, but it would take companies pushed investments into the future.
until 2015 before a new record figure of just over As industrial companies worldwide successfully
USD 2,000 billion could be noted. adapted their manufacturing operations to new
The figures for the last five-year period show health and safety regulations, disruptions to sup-
a gradual decline and flattening of cross-border ply chains decreased. After the dramatic decline
investment, while the mergers and acquisitions during the first half of the year, demand for goods
(M&A) market has been stable and growing. from producers and consumers increased. E-com-
The downshift may be partly due to indus- merce got a significant boost. The craving for con-
trial companies’ increased orientation towards sumer goods in electronics, furniture and inte-
near-market manufacturing, which reduces the rior design surged when many people built their
extent of relocation and fragmentation of pro- own home offices. Gradually, demand for dura-
duction in different countries. A global politi- ble goods such as cars and white goods returned.
cal upswing for economic nationalism and indus- Growth bounced back, and the market outlook
trial policy may also play a role, as may the gradually improved already in the second half
increased geopolitical tensions, not least between of 2020. The pandemic’s strong negative impact
the United States and China. The EU has intro- on the household services sector, the events sec-
duced an investment screening procedure with tor and the hospitality industry remained, but the
Chinese companies as its main target and has large national support packages and unexpect-
launched a new industrial policy that will provide edly rapid development of effective coronavirus
“open strategic autonomy”. American companies vaccines gave businesses and consumers cause for
are encouraged to bring home production from renewed optimism.
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 5Despite continued extensive travel restrictions, establishments in foreign markets, so-called
the M&A market picked up again after the sum- greenfields, fell by 29 per cent globally to about
mer, with particularly high activity in the health- 13,000 last year. The decline was particularly large
care sector and among TMT companies (Technol- in the manufacturing industry.
ogy, Media and Telecom), which produced many
winners during the pandemic. The companies SHARP DROP FOR EUROPE
quickly adapted to a new reality. Virtual nego- Foreign direct investment in Europe fell by 77 per
tiations and decision-making processes replaced cent to USD 97 billion by 2020. In usually large
physical visits and inspections. Bidders’ detailed recipient countries such as Germany, France and
screening of potential target companies, so-called the United Kingdom, foreign investments were
due diligence, expanded in focus. Has the com- halved.
pany received state aid, and if so, under what con- In Asia, foreign investment was basically at the
ditions? What guarantees have been given to same level as the year before. Investments of USD
employees within the framework of, for example, 540 billion meant a decline of only 2 per cent. In
furlough schemes? China, FDI increased by 6 per cent to USD 149
The consulting firm Mergermarket estimates billion. In Hong Kong, which is reported sepa-
that the total value of cross-border M&A rately in the statistics, investments increased by
decreased by 12 per cent for the full year 2020 just over 60 per cent to USD 119 billion. Both for-
compared with the previous year. The number of eign companies and companies from mainland
M&As decreased by 20 per cent. China often use Hong Kong as a formal seat for
The pandemic and its inhibiting effects on their operations in China for tax reasons and sim-
international trade have also led many compa- pler administration. Most other countries in Asia
nies to strengthen the resilience of their produc- noted a drop or stagnation in FDI, except for
tion networks. Some companies have concluded India, where investments increased by 27 per cent
that they need to expand their supplier network so to USD 64 billion. All in all, this meant that Asia
that substitutes are available if someone falls away. received half of last year’s foreign investment.
Other companies have upgraded the risks associ- In North America, FDI fell 39 per cent to USD
ated with local production in certain markets. In 209 billion. The US attracted approximately 75
parallel with this, China’s increasingly sharp tone per cent of the investments, but the country’s
towards the United States and Europe has made recorded FDI level of USD 156 billion is the low-
American and European companies want to avoid est since the global financial crisis, and well below
dependence on Chinese suppliers. the annual average of USD 275 billion over the
A compilation made by the consulting firm past decade.
fDi Intelligence shows that the number of new The development went in different directions
ASIA RECEIVED HALF OF LAST YEAR’S FOREIGN INVESTMENT
FDI inflows by region 1995–2020, USD billion
1,000
800
600
Asia and Oceania: 540 (54%)
400
North America: 209 (21%)
200 Europe: 97 (10%)
South America: 59 (6%)
Middle East: 54 (5%)
0 Africa: 40 (4%)
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20
20
20
20
20
20
19
20
20
19
20
19
19
20
20
20
20
20
Note: Regional share of global FDI inflows 2020 in brackets. Definition of regions by Business Sweden.
Sources: UNCTAD, Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 6in the smaller investment regions. In the Middle US AND CHINA WERE THE
East, foreign investment increased by 24 per DOMINATING INVESTMENT MARKETS
cent to USD 53 billion. In Africa, FDI fell by 16 20 largest recipient countries of FDI
2020 and 2019, USD billion
per cent to USD 40 billion. In South America,
investments fell as much as 54 per cent to USD
59 billion, including a 62 per cent fall in severely 1 (1) USA 156
149
corona-stricken Brazil. 2 (2) China
119
3 (5) Hong Kong
Foreign direct investment stock has increased 4 (3) Singapore 91
over time in all regions. Existing stock is a more 5 (8) India 64
stable measure of investments than inflows, where 6 (7) Germany 36
differences in amounts from one year to another 7 (4) Ireland 33
can be significant. Slightly simplified, it can be 8 (13) Mexico 29
26
9 (28) Sweden
said that stock must be equal to the accumulated 10 (6) Brazil 25
inflows. Still, in the statistics, this is rarely the 11 (17) Israel 25
case as they are reported by the companies and 12 (10) Canada 24
measured differently. 13 (12) Australia 20
Although Asia received half of last year’s global 14 (19) UAE 20
20
15 (11) United Kingdom
FDI inflows, Europe maintains its position as the 19
16 (16) Indonesia
region with the largest FDI stock. Europe holds 17 (14) France 18
36 per cent of all assets, followed by North 18 (21) Vietnam 16
A merica with a 30 per cent share and Asia with 19 (22) Japan 10
a 24 per cent share. 20 (27) Poland 10
0 50 100 150 200 250 300
The 20 largest recipient countries for for-
Note: 2019 ranking in brackets. 2020
eign direct investment in 2020 were all markets Sources: UNCTAD, Business Sweden (2021) 2019
in Europe, North America and Asia, except for
Israel and the United Arab Emirates, which give
the Middle East two important FDI destinations.
The United States and China are at the top as this
year’s most attractive investment markets. Six
European countries are on the list. Sweden comes
in at 9th place, climbing from 28th place in 2019.
However, the ranking is based on the preliminary
figure for FDI inflows in Sweden 2020, which will
probably be revised significantly downward.
INVESTORS CONTINUE TO HAVE THE LARGEST PRESENCE IN EUROPE
FDI stock by region 1995–2019, USD billion
15,000
Europe: 13,259 (36%)
North America: 11,029 (30%)
10,000
Asia and Oceania:
8,675 (24%)
5,000
South America: 1,694 (5%)
Africa: 942 (3%)
0 Middle East: 759 (2%)
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19
20
20
20
20
20
Note: Regional share of global FDI stock 2019 in brackets. Definition of regions by Business Sweden.
Sources: UNCTAD, Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 7FOREIGN DIRECT
INVESTMENT IN SWEDEN
MATURE INVESTMENT MARKET The annual amounts of foreign direct invest-
Sweden has been a significant recipient country ment in Sweden can be compared with the var-
for foreign direct investment since the mid-1990s. iations in the so-called GDP gap, which shows
With Sweden’s EU accession in 1995, higher the difference between actual and potential GDP
economic growth than in large parts of Europe and is a measure of the business cycle. When the
and a period of extensive deregulation and privati- diagram line is above zero, the economy is good,
sation of public enterprises, interest in the Swedish while it is weak when the line is below zero.
market increased. An open and transparent M&A The deviation from the economic situation in
market made successful Swedish companies 2020 is significant. Foreign direct investment in
sought-after acquisition objects. Over time, a large Sweden tentatively amounted to SEK 240 billion,
number of Swedish companies have been acquired which is more than a doubling from SEK 96 billion
by foreign buyers. Foreign companies currently the year before and well above the annual average
employ 680,000 people in Sweden. of SEK 108 billion for 2001 to 2020.
The annual FDI inflows into Sweden typically It should be emphasised that the process for
move up and down in line with the global eco- determining FDI inflows into Sweden in 2020 has
nomic situation. The varying level of investment not been completed and is partly based on Statis-
reflects that companies tend to expand their oper- tics Sweden’s forecast for reinvested earnings. The
ations and take on new markets such as Sweden amount may therefore be revised down significantly.
in good times, while their enthusiasm for foreign A compilation by the consulting firm Merger-
expansion cools when times are worse. This fluc- market shows that 125 cross-border M&A deals
tuation is reinforced by the fact that major com- were completed last year with Swedish companies
pany acquisitions can make a big impression on as acquisition objects. This is a decrease from 177
the statistics. A stabilising factor is that a large deals in 2019. The consulting firm fDi Intelligence
part of the profits generated by the already estab- reports a slight increase in foreign greenfield
lished foreign companies in Sweden is often rein- projects in Sweden in 2020 compared with the
vested in Swedish operations. previous year.
SWEDEN STANDS OUT WITH A STRONG YEAR IN 2020
FDI inflows and GDP gap in Sweden 2001–2020, SEK billion and per cent
300 FDI inflows
GDP gap
250
SEK 240 bn 2020
200
150
SEK 108 bn average for the
100
period 2001–2020
50 5
Per cent (%)
0 0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
15
16
17
18
19
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
-5
Sources: Statistics Sweden, The National Institute of
Economic Research , Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 8SMALL BUT CLIMBING ASIA
Foreign direct investment stock in Sweden
amounted to SEK 3,170 billion in 2019, the
year for the latest available figure. The assets
are primarily related to companies based in
the neighbouring Nordic countries and other
European countries with a presence in Sweden.
Together, European companies account for 87
per cent of total FDI stock. Holding companies
in mainly Luxembourg and the Netherlands
are large investors in the statistics, but in most
cases, the controlling parent company is located
elsewhere, sometimes even in Sweden.
ASIA’S ASSETS ARE SMALL BUT GROWING FAST
FDI stock in Sweden 2014 and 2019, SEK billion and average annual change in per cent
2,200 FDI stock in Sweden
2,000 2,001 Rest of Europe: +5% 2019, distribution by region in per cent
1,800
1,600
1,400
1,200 Nordic countries 24%
1,000 Rest of of Europe 63%
800 755 Nordic countries: +4%
North America 7%
600 Asia 5%
400 Other 1%
230 North America: +3%
200
150 Asia: +21%
0
2014 2019
Note: FDI stock In Sweden increased by SEK 666 billion over the past five-year period, from SEK 2,504 billion in 2014 to
SEK 3,170 billion in 2019. This represents an average annual increase of 4.8 per cent.
Sources: Statistics Sweden, Business Sweden (2021)
FOREIGN INVESTORS PRIMARILY FOCUSED ON THE SERVICES SECTOR
FDI stock in Sweden 2014 and 2019, SEK billion and average annual change in per cent
2,000 FDI stock in Sweden
1,800 1,779 Services sector: +5% 2019, distribution by sector in per cent
1,600
1,400
1,200 1,207 Manufacturing: +2%
1,000
800 Services sector 60%
Manufacturing 40%
600
400
200
0
2014 2019
Note: Total FDI stock of SEK 3,170 billion for 2019 includes assets in diverse industries and assets
in forestry, fishing and mining. These assets are left out in the above compilation.
Sources: Statistics Sweden, Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 9Companies from North America, mainly
American companies, account for 7 per cent of
assets with a shrinking share in the last decade.
Asian companies have significantly increased their
presence and now hold 5 per cent of the assets.
The services sector attracts 60 per cent of total
FDI stock, while 40 per cent of assets go to the
manufacturing industry.
Assets in the services sector amounted to SEK
1,779 billion, with significant foreign investment
in mainly finance and insurance, trade and
services and real estate. Assets in the manu-
facturing industry amounted to SEK 1,207
billion. In this sector, foreign companies have
made the largest investments in chemicals and
pharmaceuticals, food and automotive.
CHEMICALS AND PHARMA MOST TARGETED MANUFACTURING INDUSTRIES
FDI stock in Sweden 2014–2019, SEK billion and average annual change in per cent
500 FDI stock in Sweden
474 C hemicals and
450 pharmaceuticals: +3% 2019, distribution by industry in per cent
400
350
Services sector 60%
300
Chemicals and pharmaceuticals 16%
250
Food 7%
200 211 Food: 0%
172 Automotive: +5% Automotive 6%
150 155 Wood and paper: +3%
Wood and paper 5%
133 Metals and machinery: +4%
100 Metals and machinery 4%
62 Other manufacturing: -3%
50 Other manufacturing 2%
0
2014 2019
RAPID INCREASE IN RETAIL, SERVICES AND REAL ESTATE
FDI stock in Sweden 2014–2019, SEK billion and average annual change in per cent
600 FDI stock in Sweden
550 546 Finance and insurance: +7% 2019, distribution by industry in per cent
500
450
400 Manufacturing 40%
364 Retail and services: +11% Finance and insurance 18%
350
321 Real estate: +10%
300 Retail and services 12%
250 Real estate 11%
213 Energy, water and
200 recycling: +1% Energy, water and recycling 7%
150 156 Business services: 0%
Business services 5%
100 109 IT and telecom: +1%
IT and telecom 4%
70 Other services: -5%
50
Other services 3%
0
2014 2019
Note: Total FDI stock of SEK 3,170 billion for 2019 includes assets in diverse industries and assets
in forestry, fishing and mining. These assets are left out in the above compilation.
Sources: Statistics Sweden, Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 10THE OUTLOOK FOR THE
NEXT THREE YEARS
Business Sweden’s trend scouting narrows down The internationalisation of business in
on the following scenario that will affect global developing countries continues. Chinese
cross-border investment and foreign investment companies continue their expansion abroad
in Sweden: but are hampered by stricter rules at home and
new review procedures for foreign markets.
National and local restrictions to prevent the For the first time, Chinese companies get into
spread of infections are being phased out as top position as world-leading foreign investors.
the coronavirus pandemic subsides. The nor- With new legislation (Foreign Investment Law,
malisation of society and the comprehensive January 2020), the opportunities for foreign
financial support packages are driving growth. companies to acquire Chinese companies
Companies restart their paused plans for increase, but considerable restrictions remain
foreign expansion in greenfields and M&As. in place. China’s escalating conflict with the
The UN agency UNCTAD’s forecast indicates United States and the EU and the hardening
15 per cent growth in global cross-border tone towards foreign companies prompt more
investment in 2021 and a further 20 per cent and more companies to reassess their market
in 2022. A stable global economy can lift the presence and widen the scope to countries in
investments in 2023 as well. Southeast Asia.
The manufacturing industry slows down the
pace of localisation of production to low-wage
countries. Instead, increased automation and
demands from customers for rapid product
development and short lead times drive compa-
nies towards near-market manufacturing and
sourcing of intermediate goods. The regionali-
sation of industrial companies’ production and
trade increases. Companies continue to expand INVESTMENTS BOUNCE BACK
their supplier networks to increase resilience AS PANDEMIC FADES
in crises. Some repatriation of production will Global cross-border direct investment
be the result of industrial policy in the US 2015–2023*, USD billion
and Europe. China continues to build its own
2,500
supply chains for prioritised sectors.
Beyond the pandemic, digitalisation and the 2,000
ongoing technology shift in industry will
be accelerating. Countries’ investments in a +20% 2022
green transition provide new opportunities for
foreign investors.
1,500
?
The shift towards services continue to 1 000
accelerate in business and international trade. +15% 2021
Large capital investments in machinery
500
and equipment become less frequent. But
15
16
17
18
19
20
21
22
23
cross-border M&A deals with highly valued
20
20
20
20
20
20
20
20
20
service companies as acquisition objects boost *Note: The prospects for 2021–2022 are based on UNCTAD’s forecast.
foreign direct investment. Sources: UNCTAD, Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 11INVESTMENTS BY CHINESE COMPANIES IN GLOBAL LEAD
ODI flows from the US, Japan and China 2001–2020, USD billion
500
400
300
200
China: 133
100 Japan: 116
USA: 93
0
-100
-200
01
02
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20
20
20
20
20
20
20
20
20
20
Note: The sharp decline in outward direct investment by US companies in 2018 was due to substantial
repatriation of profits accumulated overseas, as a result of the 2017 US tax reform.
Sources: UNCTAD, Business Sweden (2021)
BUSINESS SWEDEN | C R A S H A N D R E S TA R T | 12932 EN 2021
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BUSINESS-SWEDEN.COM
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