Newmark Expert Authors Online Article About Election Implications on FDI
Newmark Senior Managing Director Gregg Wassmansdorf recently authored his latest column for fDi Magazine titled Presidential Elections and their Impact on US FDI. In the opinion piece, Mr. Wassmansdorf highlights historical data suggesting in the US, the party occupying the White House has does have an impact on foreign investment.
“At the time of writing, only the first of three televised presidential candidates’ debate have taken place — an event that offered more heat than light. The president and close advisors had then been notified of their Covid-19 infections, and the country was reporting more than 43,000 new daily cases than in the previous week. This is not confidence-building for foreign investors, but does it matter? The US is perennially one of the top foreign direct investment (FDI) destinations in the world. Moreover, will the election results even matter?
It is interesting to look back at how inward FDI has increased or decreased in the years immediately preceding and following US presidential elections. Using 49 years of World Bank data on global FDI between 1972 and 2019, some interesting facts emerge.
Over this period, the median year-over-year change in inward US FDI was +15%. Half the time FDI growth was higher, but half the time growth was lower or substantially negative. Annual change in FDI was positive 29 times (about 60 percent of the time) but negative in all other years. Investment flows are highly volatile, although annual variability appears to have decreased over time (this pandemic year not included).”
Read the full article, Presidential Elections and their Impact on US FDI.