The 2016 A.T. Kearney Foreign Direct Investment Confidence Index®

Investors are turning their attention to developed economies in North America and Europe because of profound uncertainty in many emerging markets.

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 Gain   Decline   Return to Index   No change
Rank Country Change from 2015 Score
2016/2015
(Scale of 3)
Remarks

1 United StatesUnited States 2.02/2.10 The United States is the top-ranked FDI destination for the fourth year in a row. The US economy is proving resilient to the risks facing other countries, including many other developed markets.

2 ChinaChina 1.82/2.00 China holds second place for the fourth consecutive year and attracts broad-based investor interest. Executives from industrial, service-sector, and IT firms all rank China among the top five markets for FDI.

3 CanadaCanada ▲1 1.80/1.94 Canada rises one spot to rank third in this year’s Index. Long-awaited reforms under the Investment Canada Act are making the country an increasingly attractive FDI destination.

4 GermanyGermany ▲1 1.75/1.89 Germany, the top-ranked European country, holds its highest position in 14 years. The weaker euro makes German exports more competitive, while reducing the cost for foreign investors.

5 United KingdomUnited Kingdom ▼2 1.73/1.95 The United Kingdom falls two spots from last year but remains among the top five in the Index. A decision to exit the EU could reduce the growth in future FDI inflows.

6 JapanJapan ▲1 1.73/1.80 Japan rises one spot this year to sixth place—its highest ranking ever. The government is committed to raising its FDI stock from 17.8 trillion yen in 2015 to 35 trillion yen by 2020.

7 AustraliaAustralia ▲3 1.63/1.79 Foreign investors are optimistic about Australia’s business environment, despite the government’s mixed signals about its openness to foreign investment.

8 France 1.60/1.80 France maintains its eighth position in the Index. The “Creative France” campaign targets investors from 10 key countries, including the UK, Germany, Japan, Singapore, and the UAE.

9 IndiaIndia ▲2 1.60/1.79 India’s rise demonstrates its increasing attractiveness to foreign investors. Reforms such as the “Make in India” initiative underline the government’s commitment to attracting FDI.

10 SingaporeSingapore ▲5 1.57/1.73 Singapore is the largest gainer in this year’s Index, rising five spots to reach 10th place. Investors from the Asia Pacific region and in the IT industry are the most interested in investing in Singapore.

11 SwitzerlandSwitzerland ▲3 1.54/1.74 Switzerland’s sustained moderate economic growth, high consumer spending, and extremely competitive business environment help the country rise three positions to 11th place.

12 BrazilBrazil ▼6 1.53/1.87 An economic recession, ongoing corruption scandals, and record-low consumer confidence are likely the main factors that pushed Brazil from the top 10 of the Index for the first time in more than five years.

13 SpainSpain ▲4 1.51/1.71 Spain posts the largest gain of any European market. Falling unit labor costs and fairly open foreign investment policies have made the country increasingly attractive to FDI.

14 NetherlandsNetherlands ▼1 1.51/1.74 The Netherlands has a welcoming business environment and strong infrastructure and institutions, propelling it to 14th place in the Index and a top 10 position among European executives.

15 TaiwanTaiwan 1.50/NA Taiwan returns to the FDI Confidence Index after a two-year absence. The country is adopting measures such as free economic zones to attract investments from high-end service industries.

16 ItalyItaly ▼4 1.48/1.75 Italy appears on the Index for the third consecutive year. The Renzi government has introduced legislation such as the Investment Compact Act to attract more FDI in the coming years.

17 South KoreaSouth Korea ▼1 1.47/1.72 South Korea falls one spot this year. Proposals are in the works to gradually open up 29 restricted sectors to FDI as part of a plan to increase FDI inflows to $30 billion by 2017.

18 MexicoMexico ▼9 1.45/1.79 Mexico falls nine spots to 18th this year, its lowest ranking since 2012. Most investors interested in Mexico are headquartered in the Americas, and many are industrial firms.

19 BelgiumBelgium 1.44/1.70 Belgium holds steady at 19th place. The country continues to attract FDI thanks to strong logistics and infrastructure and a central location near other large European markets.

20 DenmarkDenmark 1.42/1.69 Denmark ranks 20th in the Index for the second year in a row. Although other European countries and Japan have been the largest sources of FDI in recent years, interest from Chinese investors is increasing.

21 ThailandThailand 1.42/NA Thailand returns to the Index after a two-year absence. An incentive policy to attract IT companies is one element of the strategy to give preferential treatment to foreign projects in the technology sector.

22 SwedenSweden ▼4 1.42/1.71 Thanks to Sweden’s high-tech infrastructure, the country—like its Nordic neighbors—is particularly appealing to investors in clean energy, telecommunications, IT, and healthcare.

23 IrelandIreland 1.40/NA Ireland returns to the Index after more than a decade. Ireland’s agency for industrial development announced in 2015 that it aims to increase FDI by more than 40 percent by 2019 and create 80,000 jobs.

24 AustriaAustria ▼3 1.39/1.69 European countries are the source of most of Austria’s FDI inflows. Firms from Asia, however, are also moving in, thanks to its skilled labor force, high productivity, and a relatively low corporate tax rate.

25 NorwayNorway ▼1 1.39/1.68 Norway falls one spot to 25th place in this year’s Index. The country’s Nordic and European neighbors remain its largest investors, but Chinese firms are increasingly taking an interest.
 Gain   Decline   Return to index   No change
Rank Country Change from 2015 Score
2016/2015
(Scale of 3)

1 United StatesUnited States 2.02/2.10
The United States is the top-ranked FDI destination for the fourth year in a row. The US economy is proving resilient to the risks facing other countries, including many other developed markets.

2 ChinaChina 1.82/2.00
China holds second place for the fourth consecutive year and attracts broad-based investor interest. Executives from industrial, service-sector, and IT firms all rank China among the top five markets for FDI.

3 CanadaCanada ▲1 1.80/1.94
Canada rises one spot to rank third in this year’s Index. Long-awaited reforms under the Investment Canada Act are making the country an increasingly attractive FDI destination.

4 GermanyGermany ▲1 1.75/1.89
Germany, the top-ranked European country, holds its highest position in 14 years. The weaker euro makes German exports more competitive, while reducing the cost for foreign investors.

5 United KingdomUnited Kingdom ▼2 1.73/1.95
The United Kingdom falls two spots from last year but remains among the top five in the Index. A decision to exit the EU could reduce the growth in future FDI inflows.

6 JapanJapan ▲1 1.73/1.80
Japan rises one spot this year to sixth place—its highest ranking ever. The government is committed to raising its FDI stock from 17.8 trillion yen in 2015 to 35 trillion yen by 2020.

7 AustraliaAustralia ▲3 1.63/1.79
Foreign investors are optimistic about Australia’s business environment, despite the government’s mixed signals about its openness to foreign investment.

8 FranceFrance 1.60/1.80
France maintains its eighth position in the FDI Confidence Index. The “Creative France” campaign targets investors from 10 key countries, including the UK, Germany, Japan, Singapore, and the UAE.

9 IndiaIndia ▲2 1.60/1.79
India’s rise demonstrates the country’s increasing attractiveness to foreign investors. Reforms such as the “Make in India” initiative underline the government’s commitment to attract FDI.

10 SingaporeSingapore ▲5 1.57/1.73
Singapore is the largest gainer in this year’s Index, rising five spots to reach 10th place. Investors from the Asia Pacific region and in the IT industry are the most interested in investing in Singapore.

11 SwitzerlandSwitzerland ▲3 1.54/1.74
Switzerland’s sustained moderate economic growth, high consumer spending, and extremely competitive business environment help the country rise three positions to 11th place.

12 BrazilBrazil ▼6 1.53/1.87
An economic recession, ongoing corruption scandals, and record-low consumer confidence are among the factors that likely knocked Brazil out of the top 10 in the Index—for the first time in more than five years.

13 SpainSpain ▲4 1.51/1.71
Spain posts the largest gain of any European market. Falling unit labor costs and fairly open foreign investment policies have made the country increasingly attractive as an FDI destination.

14 NetherlandsNetherlands ▼1 1.51/1.74
The Netherlands has a welcoming business environment and strong infrastructure and institutions. These assets earn it 14th place in the Index and a top 10 position among European executives.

15 TaiwanTaiwan 1.50/NA
Taiwan returns to the FDI Confidence Index after a two-year absence. The country is adopting measures such as free economic zones to attract investments from high-end service industries.

16 ItalyItaly ▼4 1.48/1.75
Italy appears on the Index for the third consecutive year. The Renzi government has introduced legislation such as the Investment Compact Act to attract more FDI in the coming years.

17 South KoreaSouth Korea ▼1 1.47/1.72
South Korea falls one spot this year. Proposals are in the works to gradually open up 29 restricted sectors to FDI as part of a plan to increase FDI inflows to $30 billion by 2017.

18 MexicoMexico ▼9 1.45/1.79
Mexico falls nine spots to 18th this year, its lowest ranking since 2012. Most investors interested in Mexico are headquartered in the Americas, and many are industrial firms.

19 BelgiumBelgium 1.44/1.70
Belgium holds steady at 19th place. The country continues to attract FDI thanks to strong logistics and infrastructure, as well as its central location near other large European markets.

20 DenmarkDenmark 1.42/1.69
Denmark ranks 20th in the Index for the second year in a row. Although other European countries and Japan have been the largest sources of FDI in recent years, interest from Chinese investors is increasing.

21 ThialandThailand 1.42/NA
Thailand returns to the Index after a two-year absence. An incentive policy to attract IT companies is one element of the strategy to give preferential treatment to foreign projects in the technology sector.

22 SwedenSweden ▼4 1.42/1.71
Thanks to Sweden’s high-tech infrastructure, the country—like its Nordic neighbors—is particularly appealing to investors in clean energy, telecommunications, IT, and healthcare.

23 IrelandIreland 1.40/NA
Ireland returns to the Index after more than a decade. Ireland’s agency for industrial development announced in 2015 that it aims to increase FDI by more than 40 percent by 2019 and create 80,000 jobs.

24 AustriaAustria ▼3 1.39/1.69
European countries are the source of most of Austria’s FDI inflows. Firms from Asia, however, are also moving in, thanks to a skilled labor force, high productivity, and a relatively low corporate tax rate.

25 NorwayNorway ▼1 1.39/1.68
Norway falls one spot to 25th place in this year’s Index. The country’s Nordic and European neighbors remain its largest investors, but Chinese firms are increasingly taking an interest.

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