Sungwon Hong’s Post

Despite official support for open capital flows, foreign direct investment into the United States has always been controversial – particularly in periods when Americans feel their economic and technological position is under challenge. The national security objection to Nippon Steel’s acquisition bid for US Steel is particularly weak, and reflects the fact that “national security” has become an all-purpose argument, often divorced from what actually enhances or reduces security. Today’s real national security challenge is new technology acquisition; preventing technology leakage is not enough. Inward foreign direct investment is a powerful tool for acquiring and diffusing technology. https://lnkd.in/dAVXRux9

Does the US Want Foreign Investment? It's Complicated... My latest column in the Herald Insight Collection argues that, despite long-standing official support, foreign direct investment into the United States has always been controversial – particularly in periods when Americans feel their economic and technological position is under challenge. The recent national security objection to Nippon Steel’s acquisition bid for US Steel is particularly weak, and reflects the fact that “national security” has become a diffuse, all-purpose argument, often divorced from what actually enhances or reduces security. Today’s real national security challenge is acquiring new technology; preventing technology leakage is not enough. Inward foreign direct investment is a powerful tool for acquiring and diffusing technology. So is technology licensing, even from strategic competitors. https://lnkd.in/dKjUZfjs

📢 SEA Europe supports AEGIS Europe's feedback on the revision of the Foreign Direct Investment Screening Regulation recently proposed by the European Commission. This proposal aims to ramp up the existing foreign direct investment screening mechanisms in order to preserve Europe’s strategic autonomy and ensure a global competitive level playing field.🌐 ➡ SEA Europe joins forces with AEGIS Europe to call for an enlargement of the scope of the Regulation to the Maritime Technology Industry, which covers commercial and naval shipyards and their supply chain of maritime systems, equipment and services.⚓ 🚨 The Maritime Technology Industry is of particular importance for the security or public order interests of the Union as it builds, equips and maintains naval capabilities that are paramount for preserving Europe's strategic autonomy, defending its maritime borders, and securing its critical maritime and underwater infrastructure. 📍 Building and maintaining advanced naval military assets require a strong industrial value chain in commercial shipbuilding. Indeed, commercial and military shipbuilding are closely connected, sharing up to 70% of materials, supply chains, jobs, and skills. 📍 Because military orders mainly come from governments, it is important for the shipbuilding industry to maintain its capacities, jobs, supply chains, and know-how with a critical mass of commercial orders. Therefore, preserving a thriving European maritime technology industry is a critical security concern. Read AEGIS Europe's paper here 👇 https://lnkd.in/eXDs23fx 🔎 NB: The EU industrial sectors grouped within AEGIS Europe represent the entire value chain ranging from commodities such as ferro-alloys, non-ferrous metals or ceramics to end products like railway and maritime equipment, ships, bicycles or solar panels. SEA Europe is a member of AEGIS Europe.

Mexican officials announced Tuesday what they claimed was $20 billion in new foreign direct investment in Mexico, but much of that was neither new, nor completely certain. Investor confidence in Mexico has been shaken recently by controversial reforms to the energy sector and the judiciary, and the government is eager to regain the trust of foreign companies. Among the bigger announcements Tuesday was what appeared to be a final investment decision by Mexico Pacific LLC for an LNG gas terminal on Mexico’s Gulf of California, also known as the Sea of Cortez. That $15 billion project would import U.S. natural gas, liquefy it and ship it to customers largely in Asia. It is planned for Puerto Libertad, between the coastal towns of Guaymas and Puerto Peñasco. Mexico Pacific CEO Sarah Bairstow said “this represents the largest foreign direct investment to date.” However, that plan has been on the drawing boards since at least 2020, and still depends on getting cross-border gas pipelines approved and built. Mexican Economy Secretary Marcelo Ebrard said the second-largest investment was a $6 billion commitment by Amazon. While Ebrard did not specify what it was for, Amazon Web Services had already announced in February an investment of “more than $5 billion” to build cloud-computing infrastructure in Mexico. And Ebrard said the cruise line Royal Caribbean pledged to invest $1.5 billion in the Caribbean coast resort of Mahahual, south of Tulum. That was apparently a reference to the company plan — announced last week — to build a second “Perfect Day Mexico” on-shore facility for cruise ship passengers in Mahahual, which was once a sleepy coastal village until a cruise ship dock was built. Ebrard said that, together with other projects, investments could total as much as $30 billion in 2025. “The message of President Claudia Sheinbaum is certainty, assurance, investments in Mexico are safe,” Ebrard said. However, foreign governments and some foreign business groups have expressed concerns about a reform passed in September that would make all judges — including the justices of the Supreme Court — stand for election. The fear is that would politicize court cases and put foreign firms — who obviously have no vote in the elections — at a disadvantage. They fear judges would be likely to heed the will of their constituents than the letter of the law. And foreign energy companies are still smarting from their treatment at the hands of Sheinbaum’s predecessor and political mentor, former president Andrés Manuel López Obrador, who left office on Sept. 30. López Obrador pushed through laws to guarantee the state-owned electric utility a majority share of the power market. The reforms put foreign-owned electricity generating plants at the back of the line for power purchases, even though their power plants were often cleaner and used more renewables than the government’s dirty coal and fuel-oil fired generators.

In 2023, the South Korean government worked toward easing regulations and amending the regulatory framework for FDI to be consistent with global standards. Our 2024 FDI review discusses here: https://ow.ly/gpNb50RgvOm #FDI #investment

Australia’s Federal Treasurer, Jim Chalmers, has announced major changes to Australia’s foreign investment regime designed to safeguard economic and national security. Overseas investors with a proven track are set to benefit from accelerated approvals, whilst others can expect more scrutiny when investing in sensitive industries. The changes are being driven by ‘national security concerns’ and the Australian government’s new ‘Future Made in Australia’ policy. The revamp is designed to protect the government’s oversight over sensitive industries, such as supply chains, critical infrastructure, data and critical minerals, while streamlining applications in non-sensitive sectors from known investors with a good compliance record. https://ow.ly/vzGh50RuENM

Australia’s Federal Treasurer, Jim Chalmers, has announced major changes to Australia’s foreign investment regime designed to safeguard economic and national security. Overseas investors with a proven track are set to benefit from accelerated approvals, whilst others can expect more scrutiny when investing in sensitive industries. The changes are being driven by ‘national security concerns’ and the Australian government’s new ‘Future Made in Australia’ policy. The revamp is designed to protect the government’s oversight over sensitive industries, such as supply chains, critical infrastructure, data and critical minerals, while streamlining applications in non-sensitive sectors from known investors with a good compliance record. https://ow.ly/rYzT50RyuCx

Australia’s Federal Treasurer, Jim Chalmers, has announced major changes to Australia’s foreign investment regime designed to safeguard economic and national security. Overseas investors with a proven track are set to benefit from accelerated approvals, whilst others can expect more scrutiny when investing in sensitive industries. The changes are being driven by ‘national security concerns’ and the Australian government’s new ‘Future Made in Australia’ policy. The revamp is designed to protect the government’s oversight over sensitive industries, such as supply chains, critical infrastructure, data and critical minerals, while streamlining applications in non-sensitive sectors from known investors with a good compliance record. https://ow.ly/Ymfb50Rvykg

Australia’s Federal Treasurer, Jim Chalmers, has announced major changes to Australia’s foreign investment regime designed to safeguard economic and national security. Overseas investors with a proven track are set to benefit from accelerated approvals, whilst others can expect more scrutiny when investing in sensitive industries. The changes are being driven by ‘national security concerns’ and the Australian government’s new ‘Future Made in Australia’ policy. The revamp is designed to protect the government’s oversight over sensitive industries, such as supply chains, critical infrastructure, data and critical minerals, while streamlining applications in non-sensitive sectors from known investors with a good compliance record. https://ow.ly/PM3150RuGJN

Australia’s Federal Treasurer, Jim Chalmers, has announced major changes to Australia’s foreign investment regime designed to safeguard economic and national security. Overseas investors with a proven track are set to benefit from accelerated approvals, whilst others can expect more scrutiny when investing in sensitive industries. The changes are being driven by ‘national security concerns’ and the Australian government’s new ‘Future Made in Australia’ policy. The revamp is designed to protect the government’s oversight over sensitive industries, such as supply chains, critical infrastructure, data and critical minerals, while streamlining applications in non-sensitive sectors from known investors with a good compliance record. https://ow.ly/bTJB50RuPno