Glossary

Key foreign direct investment (FDI) terms and concepts

Foreign Direct Investment

U.S. foreign direct investment (FDI) is defined as the ownership or control, directly or indirectly, by one foreign person, or entity, of 10 percent or more of the voting securities of an incorporated U.S. business enterprise or an equivalent interest in an unincorporated U.S. business enterprise.

Ultimate Beneficial Owner

The ultimate beneficial owner (UBO) is the entity at the top of an affiliate’s ownership chain. It is the entity that ultimately owns or controls the affiliate and thus ultimately derives the benefits and assumes the risks from ownership or control.

Foreign Parent

A foreign parent (FP) is the first entity outside the host country in the affiliate’s ownership chain with at least 10 percent ownership in the affiliate.

Stock/Position

FDI stock (or FDI position) captures the cumulative value of an investment at a single point in time. Although rare, FDI stock or positions can be negative.

Inward Stock/Position

This measure captures the cumulative value of FDI from a market to the United States at year-end. Using BEA data, SelectUSA tracks FDI Position/Stock by the country of ultimate beneficiary owner (UBO). If UBO data is not available, SelectUSA uses data by foreign parent.

Outward Stock/Position

This measure captures the cumulative value of FDI from the United States to a market at year-end.

Flow

FDI flows are a measure of transactions that change FDI stock over a specific period of time. Note that FDI flows can be negative in certain cases, for example when there is divestment of a prior investment or when intercompany debt outflows exceed intercompany debt inflows.

Inward Flow

This measure captures FDI from one market to the United States within a given time period.

Outward Flow

This measure captures FDI from the United States to a foreign market within a given time period.

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