The Impact of U.S. Laws on Foreign Direct Investment

The U.S. economy has been and continues to be more open to foreign direct investment than any economy in the world. National policy is one of complete neutrality, but when state and local incentives are considered, the overall stance may be one of encouragement. At the national level, potential foreign investments are scrutinized only vis-à -vis their threat to national security, and very few are subjected to even this examination. Monitoring foreign direct investment is now done but is not done well. Improvements in data gathering are possible and recently have been considered more seriously. More prominent recent issues in the control of foreign direct investment seem to concern infiltration of the political system, specific nationalities, and the purchases of landmark properties. In spite of discussion and legislative proposals, there is little enlightened opinion that restrictions on foreign direct investment in the United States should increase. As long as the nation-state continues to be the predominant form of world political organization, however, there will always be at least some potential—if only nominal—barriers on national security grounds.