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Australia continues to be an attractive destination for FDI

6 May 2011

Foreign direct investment (FDI) into Australia continues to grow, demonstrating investor confidence in the strong Australian economy. Data released by the Australian Bureau of Statistics* shows that, year on year, FDI into Australia grew by 7.5 per cent to A$474 billion in 2010 after an 11.1 per cent  increase in 2009.

The top five major FDI source countries continue to be the United States, the United Kingdom, Japan, the Netherlands and Switzerland.

FDI from the United States jumped 20.4 per cent to A$120 billion during 2010, and FDI from China grew by 41 per cent to A$12.8 billion following an increase of almost 150 per cent in 2009.

Significant growth on 2009 FDI figures has also come from Korea (up 61.8%), Canada (31.6%), ASEAN (25.9%), Singapore (22.6%) and Hong Kong (22.5%).

The outlook for 2011 is positive. Moody’s Investors Service has maintained a stable outlook for Australia's Aaa ratings based on the agency’s latest report, released May 1.

Specifically, the Aaa ratings remain stable due to very high economic and government financial strength, and very low susceptibility to event risk.

An overall improving trend in the budget from previous high deficit levels was noted by Moody’s, with the impact of natural disasters such as the Queensland floods expected to be minor.

In its World Economic Outlook in April 2011, the IMF also noted Australia’s continued strong economic performance. The economy grew by 2.7 per cent in 2010 and is forecast to grow by 3 per cent in 2011 and 3.5 per cent in 2012.

*2010 Investment figures from the Australian Bureau of Statistics (ABS) [Cat.5352.0], released May 3

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