So It Begins Again
I was reading a rather interesting Hitchens piece about how much he dislikes Michael Moore, and it seems that one of the clamis of Moore’s new film is that:
Saudi capital in general is a very large element of foreign investment in the United States.
Well, I decided to do a little investigating. This BEA Report is the most recent I could find, and has data up through 2001. On a historical-cost basis, “Middle East” Foreign Direct Investment (FDI) in the US makes up about 0.045% of FDI. By contrast Canada makes up about 8.22% and “Europe” makes up about 71.7%.
On a capital flow basis, the “Middle East” as a region actually recieves more FDI from the US than it sends here. Middle East capital inflows in 2001 were -$159 million, meaning that US businesses sent $159 million more of capital to the Middle East than the entire region sent to the US. Middle Eastern FDI only accounts for about 1.95% of income from FDI in the US.
But wait, there’s more! That only covers the income/production side of FDI, what about Middle Eastern holdings? Well, the second table in that same document has information about non-bank foreign affiliates in the United States. Of total assets held by foreign non-bank affiliates, Middle Eastern investment makes up 0.66%.
The other data in the tables points the same direction, that Middle Eastern investment in the United States is a relatively small proportion of FDI and, even assuming that ALL of that investment is Saudi, Saudi investment in the United States is a tiny proportion of the FDI that happens here, which is in turn a tiny proportion of the economy (10-15%).
It should be noted that in a lot of cases a “foreign firm” is sort of a nebulous term, but IIRC the US reporting standard is that being 15% foreign-held makes a firm “foreign” for the purposes of FDI reporting. A brief summary of the reporting requirements for FDI in the United States can be found here.
I’ll cover the personal investment side later, because that data isn’t really as interesting, is far afield from my areas of knowledge, and will take a lot longer to dig up.
