FDI levels are holding fast in Russia, despite the dip in overall foreign investment. After a decade of dithering, foreign direct investors are pouring money into Russia.

The impending demographically diminished talent pool does not fall equally on the “just and the unjust”. While the US Social Security debate remains unsettled, it does call attention to an emerging population reality: in the US, we can look forward to fewer and fewer people in their prime working age (25 to 40 years old).

Firms setting up corporate offices in the US will find the best bargains south of the Mason-Dixon line, according to a report from New Jersey-based location consultancy The Boyd Company.

Environmental campaigners have long argued that multi-national companies encourage pollution havens by rewarding poorly regulated countries with investment dollars. There is some truth in this, but smart companies are getting wise to the opportunities thrown up by tougher environmental laws.

Invest in Sweden and Australia’s City of Melbourne agencies have been touted as world leaders in investment promotion by a benchmarking survey carried out by GDP Global Development and the Multilateral Investment Guarantee Agency (MIGA).

The Kyoto Protocol entered into force for 140 countries and the EU on February 16, 2005. It includes provisions for a Clean Development Mechanism (CDM), which gives monetary value to greenhouse gas emission reductions achieved through climate protection projects implemented in developing countries with foreign financing.

• Vietnam is in the process of creating a unified legal framework for the conduct of business. The proposed Enterprise Law will merge laws addressing different types of companies, including the State-owned Enterprises Law and the Foreign Investment Law. The proposed law, still at the draft stage, is expected to make significant headway into streamlining the regulation of business activity in Vietnam. For example, under the law, foreign investors will be able to form any type of company instead of only limited liability companies.
  Vietnam is also in the process of reviewing a draft law on intellectual property rights, which is expected to be ratified later this year.

FDI results for 2004 from the two main inward investment research databases highlight some interesting emerging trends. Overall, 2004 saw increased activity and investment globally, though in Europe, in spite of increased projects, there was a decrease in jobs created.

Historically, US companies generate most investment in other countries around the world. This is true for most industries, including the ICT sector. In recent years most of this investment has gone into India and China, where large numbers of jobs are being created by multinational firms seeking access to the strong skill base and competitive costs.

A combination of economic and geopolitical trends are likely to result in more investment dollars filtering down to commercial real estate investment opportunities in north America over the coming months. At the same time, some of these same trends are prompting the worldwide spread of an American investment concept that could open up worldwide real estate investment markets to small investors.

Most of the attention regarding China’s automotive industry is focused on investments by international companies. In recent months however, there have been growing signs of investment activity in the other direction – Chinese auto manufacturers and suppliers looking to expand outside of their home market.

Demand for microfinance is high and Investment Capital Trust is demonstrating the potential gains to be made while bolstering emerging economies.

Locations the world over are vying for a share of the growing but still relatively small biotech industry. Although a few newcomers offer tempting alternatives, the established clusters are not about to give up their top spots. Karen E Thuermer reports.

The doors of the Biotechnology Industry Organization’s (BIO) 2005 Annual International Convention will open in June to the 18,000 or so attendees, representing both established and up-and-coming biotech companies. Economic development representatives from all over the world will be anxious to present their arguments about why delegates at Philadelphia’s Convention Center should consider locating to their city or region.

According to Ernst & Young, the Canadian provinces of Quebec and Ontario rank just behind California and Massachusetts as top North American locations. Canada competes with the UK after the US for new biotech investment, patents and venture capital. Large multinational biotech companies dominate the market although, of Canada’s 389 private firms, 312 have less than 20 employees, 243 have less than 10 and 153 have less than five.

With the Asia-Pacific region accounting for about $1bn of the global biotechnology market, Australia, India and Singapore are well positioned to become key players.

Pennsylvania, the BIO 2005 host state, is cultivating a burgeoning biotech industry through industry networks and funding initiatives, reports Karen E Thuermer.

One of the earliest companies in the small-molecule business, the Philadelphia start-up Cephalon has grown into a biotech giant. Karen E Thuermer reports.

Even the largest and most successful bio-pharmaceutical companies face innumerable challenges, Wyeth CEO Robert Ruffolo tells guests at the Pennsylvania Biotechnology Association 2005 Annual Dinner.

A new chapter in genetics is being written in Arizona as the field of translational research begins to burgeon, taking discoveries quickly from laboratory to clinical use.

Italy’s life sciences sector is gaining momentum, spurred on by its reputation for research capabilities and drugs trials.

Life sciences company Serono, originally founded in Italy, has returned there to set up a new research facility.

The life sciences sector in the Northern Netherlands has developed into a co-operative cluster that is proving successful.

The US state of Florida provides fertile ground for biotech investment.

Biotech investors in Puerto Rico get the dual perks of being in the US yet also offshore, PRIDCO head Marie Robert tells fDi.

From coast to coast, the US has been scoured for the Cities and States of the Future. fDi announces the winners of the first heat, which is divided into four regional categories. By Karen E Thuermer .

STATE OF THE FUTURE: TEXAS

Texas has long been known for its wide, open spaces, the oil and gas industry, the Houston Space Center, cattle and cowboys. The “Lone Star State” has a dynamic economy. For 2004, its gross state product (GSP) was $847.81bn, according to the Texas Gross State Product Detail, Current Dollars. For 2005, GSP is forecast to be $886.1bn and for 2010, $1146.3bn. These forecasts indicate a 4% GSP increase between 2004-2010, with an average increase of 7% per year between 2004 and 2010.

STATE OF THE FUTURE: IOWA

Iowa has many surprises. Its GSP for 2003 was $103bn, up 4.9% from $98.2bn in 2002, according to the BEA (2004). A number of overseas firms call Iowa home. Its Department of Economic Development recently assisted 12 foreign companies investing $240m in the state, which equates to $0.83 per citizen. Deals for six new projects and six expansions were signed in 2004. Significant investments in 2004 included those from LeSaffre ($50m), Kerry Ingredients ($30m) and Ajinomoto ($27.5m).

STATE OF THE FUTURE: NEW YORK

With a GSP of $821.7bn in 2003, the last year for which figures are available, New York State represents 7.1% of the national economy. Strong exports and domestic expansions guarantee the “Empire State” will continue to provide positive economic growth. The international division of Empire State Development works to attract FDI through its five overseas offices (four of which are for export promotions only).

The state offers an educated workforce – more than 27% hold university degrees. More than 300 universities and academic institutions are located in the state, among them Cornell University, Columbia University, New York University, the Julliard School of Music and others.

STATE OF THE FUTURE: FLORIDA

For 2003, Florida’s GSP was $550bn, a 5.7% increase over 2002. Last year, more than $2737bn was committed for inward investment, representing $157.34 per capita. Deals involved 15 foreign investments. The three most significant deals in 2003 were: Embraer Aircraft Holdings (Brazil), a $10m investment; Gambro Renal Products (Sweden), $24m; and Hyundai Mobis Parts America (Korea), $1.2m.

About 25% of the state’s population holds a university-level degree. Florida offers 11 state public universities and numerous private universities.

The round one winners of fDi’s Canadian Cities and Provinces of the Future contest have been chosen. Karen E Thuermer reports.

PROVINCE OF THE FUTURE: ALBERTA

Despite fluctuating economic cycles in the global economy, Alberta has maintained a strong economy, largely thanks to its abundance of natural resources. This, in addition to a positive investment climate, has allowed Alberta businesses to compete successfully around the world. The provincial gross domestic product (GDP) is $170.8bn with a growing average rate of 3.7% a year.

PROVINCE OF THE FUTURE: ONTARIO

Ontario is a province on the move. In 2003, its nominal GDP reached its highest value at C$494.5bn ($380bn). According to Statistics Canada and the Ontario Ministry of Finance, real GDP growth averaged 3.1% from 1982 to 2003.

PROVINCE OF THE FUTURE: NOVA SCOTIA

According to the Bank of Montreal, Nova Scotia’s GDP was 1.2% in 2003, increased to 1.8% in 2004 and is forecast to hit 2.5% for 2005, a clear sign of an improving economy.

About C$840m was committed to the province in calendar year 2004, roughly C$896 per capita, as indicated by the Invest in Canada database. These figures include those that have been publicly announced in the media, although projects included must involve capital expenditures exceeding C$1m for most sectors. The exception is retail, entertainment and hotels.

PROVINCE OF THE FUTURE: NORTHWEST TERRITORIES

With 1.17 million km2 of mountains, forests and tundra threaded by wild, clean rivers feeding thousands of pristine lakes, the Northwest Territories is a land of contrasts. More than 40,000 people live in this ruggedly beautiful province. About half that population is aboriginal.

The US government wants to entice companies to repatriate more foreign profits with the Homeland Investment Act. However, it is still unclear how many will accept the offer, reports Erika Morphy.

Will Canada’s latest budget keep up the country’s momentum for FDI? David Clarke reports on reaction to the new government’s first crack of the fiscal whip.

As the Franco-Turkish automotive joint venture enters its 36th year having set new records in 2004, Courtney Fingar asks what lies ahead for this and similar partnerships.

In 1969, Renault began manufacturing cars in Turkey under the terms of a joint venture with Oyak Group, one of the country’s largest industrial conglomerates. After three decades of successful partnership, the joint venture now produces 162,000 cars a year and that figure is set to double with capacity increases at the Bursa plant, Renault’s largest outside Europe.

At a recent roundtable, virtual ambassadors for the Spanish region of Murcia tell Courtney Fingar why they believe the area has as much to offer investors as it has to gain from increased levels of FDI.

Frankfurt’s mayor, Petra Roth, tells Courtney Fingar that despite Germany’s limping economy, structural problems and high costs, the city is attracting big name foreign investors.

High-profile film studios and access to rural, urban and historic locations have led to Umbria becoming an attractive site for film-makers. The regional development agency is playing to these strengths, reports Nick Kochan.

Investment in Europe’s shared service centre market has come in waves. Peter Lemagnen of Oxford Intelligence examines the ebb and flow.

Companies faced with the battle of multi-lingual recruitment can optimise their HR functions to deliver increased return on investment, writes Gerry Rockingham.

Attention to language and business skills is allowing Bulgarian BPO firms to supply a quality service.

The new Ukrainian government needs to do some housekeeping in its real estate market to make it more investment friendly, reports James Hydzik .

Botswana is a shining example of political and economic stability on the African continent, with its A-grade credit ratings, well-educated workforce, growing financial sector, mineral wealth and strong export focus.Wendy Atkins assesses the attractions for foreign investors.

Doing business in Iraq is not for the faint-hearted. But since the January elections, hopes are rising and trade and investment are picking up. Erika Morphy reports.

Although New Zealand looks economically healthy, finance minister Michael Cullen has much work to do. In an interview in Wellington, he tells Hugh O’Shaughnessy about the importance of foreign investment for the country.

Kaya Tuncer, president of ESBAS – Turkey’s Aegean Free Zone – talks about his involvement in its creation and how it is attracting global attention and generating healthy profits.

Foreign investment in the city-state often brings to mind services but the manufacturing sector is alive and well, reports Courtney Fingar from Singapore.

The Pearl River Delta has, historically, been China’s main recipient of FDI. But now, facing fierce competition, it must put its experience and expertise to work to retain the top spot, reports Louise de Rosario .

Twenty-five years ago, Hong Kong’s small-time manufacturers made a big bet on the rural Pearl River Delta (PRD), backed by limited capital but massive faith in China. The delta offered them cheap labour, abundant land and low tax, while they provided production orders, management, quality control, logistics support, marketing and other value-added services needed to sell to the world.

With easy access to mainland China and being a natural hub in the Greater Pearl River Delta, Hong Kong has become an Asian business dragon.

For all its lingering problems, Africa is growing economically and attracting larger amounts FDI. If approved, Tony Blair’s Marshall Plan for Africa could enable the continent to post even more impressive numbers, Omar Kabbaj, president of the ADB, tells Blanca Riemer.

Noreen Doyle, first vice-president of the EBRD, explains how the bank is working with foreign investors in the former command economies of central and eastern Europe, Russia and the CIS.

In the 15 years since the fall of the Berlin Wall, central and eastern Europe, Russia and central Asia have come a long way in their transition from command to market economies.

China must adjust its FDI policies if it wants to retain its global lead in inflows, writes Yong Zhang.

The Thai Board of Investment is meeting the China challenge by focusing on priority sectors, reports Brian Caplen from Bangkok.

Pharmaceutical FDI projects attracted more than $15bn in the three years to February, according to OCO Consulting’s sample of 541 projects worldwide.

The US was the dominant location for biotechnology projects in the three years to February, attracting nearly 17% of OCO Consulting’s worldwide sample of 214 firms.

China attracted 11% of healthcare FDI projects, beating the US total of 7.4%, in OCO Consulting’s sample of 336 projects worldwide in the three years to February.