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FROM SITE SELECTION MAGAZINE, MAY 2022 ISSUE
From the May Issue

NEWS DIGEST

World Reports

Quick-hitting stories update you on an Indian state’s growing EV credentials; an Amazon-centered project sidelined in South Africa; Dyson’s new HQ city; and reawakening FDI.

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From the September Issue

INVESTMENT PROFILE: GRUPO KARIM’S

A Smarter Global Platform

Two advanced developments in Honduras connect forward-thinking companies to worldwide markets.

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 CONWAY ANALYTICS SNAPSHOT 

Global foreign direct investment flows over the last 30 years


Today in Geneva, Switzerland, the United Nations Conference on Trade and Development (UNCTAD) released the UNCTAD World Investment Report, which found that global FDI flows rose by 64% from a low base in 2020 to $1.58 trillion last year “with momentum from booming merger and acquisition (M&A) activity and rapid growth in international project finance due to loose financing and major infrastructure stimulus packages.” Flows to developing economies rose 30% to $837 billion — the highest level ever recorded, says UNCTAD — “largely due to strength in Asia, a partial recovery in Latin America and the Caribbean and an upswing in Africa.”

UNCTAD also said the reinvested earnings component of FDI – profits retained in foreign affiliates by multinational companies – accounted for the bulk of the global growth, “reflecting the record rise in corporate profits, especially in developed economies.” Despite those profits, however, “investment by multinational companies in new projects overseas were still one-fifth below pre-pandemic levels last year. For developing countries, the value of greenfield announcements stayed flat.” Those corporate profits are sure to be impacted by the proposed introduction of a minimum tax of 15% on the foreign profits of the largest multinational enterprises. Planned for 2023 or 2024, the reforms aim to discourage multinationals from shifting profits to low-tax countries. Key implications, says UNCTAD, are:

  • Increased tax revenues from multinationals for most countries.
  • Higher taxes on foreign profits of multinationals.
  • Potential downward pressure on new investment by multinationals.
  • Reduced effectiveness of low tax rates and fiscal incentives to attract investment.
  • Urgent need for investment promotion agencies (IPAs) and special economic zones (SEZs) to review investment attraction strategies.

"While the tax reforms are going to increase revenue collection for developing countries,” said UNCTAD Secretary-General Rebeca Grynspan, “from an investment attraction perspective they entail both opportunities and challenges.”

The top 10 economies for FDI inflows in 2021 were:

  1. United States
  2. China
  3. Hong Kong (China)
  4. Singapore
  5. Canada
  6. Brazil
  7. India
  8. South Africa
  9. Russia
  10. Mexico

Compare and contrast these findings with Site Selection’s recent Global Best to Invest rankings, where our index of factors including FDI finds only three of the countries named above make the top 10: the U.S., Canada and Singapore. — Adam Bruns

 

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TEXAS ECONOMIC DEVELOPMENT GUIDE 2022-2023

AEROSPACE, AVIATION & DEFENSE

Frequent Flyers

Aerospace and defense companies the likes of Bell Textron and Raytheon keep reinvesting in Texas.

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 SITE SELECTION RECOMMENDS 

Annual Installations of Industrial Robots: North America (1,000 units)

Click Here to Enlarge


The International Federation of Robotics (IFR) on Tuesday revealed in Detroit that the North American robotics market, driven by a spate of automotive investments in EV and battery production capacity, experienced its best quarter ever to begin the year. “Companies from the U.S., Canada and Mexico ordered 11,595 industrial robots — up 28% compared to the first quarter of 2021,” the IFR reported. Revenue rose by 43% and reached a value of US$664 million. “These results are in line with a positive trend worldwide,” IFR stated. “Preliminary data for 2021 show that 486,700 industrial robots have been installed globally (+27% year-on-year).”

 

 PROJECT WATCH 

North Carolina

Originally announced in 2018 as a $140 million expansion, this manufacturing investment by Seqirus, the influenza prevention business of Australia-based CSL Limited, was completed earlier this week to support “the formulation and fill-finish of its cell-based influenza vaccines in pre-filled syringes for global communities. The new line has received FDA approval and will support influenza vaccine production for the 2022/23 Northern Hemisphere season and beyond, says Seqirus. “According to the World Health Organization, seasonal influenza can lead to up to 650,000 deaths globally each year,” said Steve Marlow, general manager, Seqirus. “As one of the world's leading influenza vaccine manufacturers, we’re continuously looking for opportunities to advance capabilities and support efficient, sustained supply of new and existing technologies. Today’s milestone is evidence of that commitment.” As documented in Site Selection, the Holly Springs manufacturing facility, the largest cell-based influenza vaccine producer in the world and the first-of-its-kind in the U.S., was purpose-built by Novartis through a public-private partnership established in 2009 with the Biomedical Advanced Research and Development Authority (BARDA). The company’s global manufacturing and supply network supporting seasonal influenza vaccine production and pandemic preparedness includes sites in Liverpool, UK; Parkville, Australia; and a new facility currently under construction in Tullamarine, Australia.

Source: Conway Analytics

Michigan

Pfizer on Monday announced this investment at its Kalamazoo, Michigan, facility, enabling U.S.-based production in support of its COVID-19 oral treatment, PAXLOVID. “Pfizer Global Supply has made the impossible possible, making billions of vaccine doses and now millions of treatment courses to help battle the deadly COVID-19 pandemic,” said Albert Bourla, Pfizer chairman and CEO. “By increasing production at our Michigan facility, we are both helping patients around the world and expanding important manufacturing innovation to the U.S. This investment builds upon our $5 billion of investments across our manufacturing and distribution portfolio since 2017 to support the ongoing growth of U.S. manufacturing leadership.” With this new investment, the Kalamazoo site (which produced some of the world’s first COVID-19 vaccine doses) will be among the world's largest producers of active pharmaceutical ingredients, with the capacity to produce 1,200 metric tons annually. Pfizer also plans to expand its Modular Aseptic Processing (MAP) sterile injectable pharmaceutical production facility in Kalamazoo, adding to an initial investment of $450 million to build a 400,000-sq.-ft. production facility. “Pfizer’s Kalamazoo facility has been at the forefront of pharmaceutical manufacturing for more than 135 years through the legacy company Upjohn,” said Pfizer Chief Global Supply Officer Mike McDermott. “Through this expansion, we will continue to invest in the next generation of manufacturing and supply chain resilience.”

Source: Conway Analytics

 

 

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 PHOTO OF THE DAY 
Photo courtesy of Insomnia Cookies

Colliers International’s retail division announced May 31 it had helped negotiate the headquarters move of Insomnia Cookies from suburban Newtown Square, Pennsylvania, to center city Philadelphia, where it will occupy three floors and feature a “store of the future” in space once occupied by Walgreen’s until it declined to renew its lease during the pandemic. The new HQ will welcome approximately 80 employees to a third-floor space once home to the men’s fashion department of Wanamaker’s Department Store. University of Pennsylvania student Seth Berkowitz launched Insomnia Cookies in his college dorm room in 2003. Today it boasts more than 200 locations. “This move marks a restoration of confidence in Center City retail and a great new amenity to the Avenue of the Arts.,” said Larry Steinberg, senior managing director - Retail, Colliers International. “We are incredibly pleased that this iconic building will now have an exciting occupant.”

 
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