Barriers to Foreign Investment in the U.S. and Other Nations

Foreign investment has often been a controversial issue because of fears that it may become a tool for foreign influence in a country's economy. This attitude was common in Latin America and other countries, but, until recently, it was rare in the United States since this country, for much of this century, had been a net capital exporter. Recent years, however, saw a change in attitude when the United States became a net capital importer. This article surveys the restrictions on foreign direct investment imposed by the United States and other major countries. It concludes that the United States is still the most hospitable country—or at least one of the most—to foreign direct investment. Recent changes, however, have reduced the distance between the U.S. openness and that of other countries mainly by making the U.S. climate for foreign investment less welcoming.