Foreign Investment Strategies Evolve Amid Shifting US Market Dynamics

Foreign direct investment (FDI) patterns in the United States are rapidly adjusting to shifting global circumstances. Recent data highlight that while the overall FDI position in the US continues to rise, new investments have started to dip, reflecting hesitancy among international firms navigating an increasingly complex regulatory and economic environment.

According to the US Department of Commerce, the total inward FDI position reached $5.5 trillion in 2023, maintaining the country’s top spot as a global recipient of foreign capital. Despite this, the volume of new FDI fell by 28 percent in 2023 to $148.8 billion, the steepest drop since 2014, raising questions about the future pace of foreign capital inflows according to US Bureau of Economic Analysis .

This downtrend has created both risks and opportunities for market entrants. While traditional FDI powerhouses such as manufacturing, financial services, and wholesale trade remain attractive, regulatory hurdles and global headwinds are prompting companies to seek deeper local guidance. Here, experienced advisory relationships take on heightened importance as international organisations tackle complex entry strategies in the world’s largest consumer economy.

Specialist Partnerships Respond as FDI Flows Slow

The recent strategic partnership between Sumihiro Investments and EDGE Partners reflects this industry trend. By combining decades of global investment experience, the two firms aim to streamline US market access for overseas organisations. Jasjit Singh, Founder of EDGE Partners and former Executive Director of SelectUSA, highlighted the importance of tailored guidance, stating: ‘It is a critical time for global firms to understand the policy environment and strategic opportunities that come with entering the US market.’ This collaboration aligns with the growing reality that clients require a sophisticated understanding of investment, regulatory, and operational factors—areas increasingly difficult to navigate independently.

Market Context: Trends, Competitors and Strategic Shifts

Industry reports underscore that, despite lower new FDI volumes, the US remains a focus for global expansion due to its established legal frameworks, skilled workforce, and innovation potential. However, FDI inflows are becoming more selective. Manufacturing still accounts for over 40 percent of total foreign investment, especially in sectors such as pharmaceuticals and advanced materials as reported by the Department of Commerce . Recent competitor activity shows a clustering in Sunbelt states, particularly Texas and Florida, where lower taxes and pro-business policies have drawn significant greenfield investment according to fDi Intelligence analysis . This competition among states further complicates decisions for foreign entrants, making local advisory capability a clear differentiator.

The pressure to navigate not only national regulations but also regional incentives is reflected in Sumihiro Investments’ own approach. Founder Gary Sumihiro points to the value of combining global insights with on-the-ground presence: ‘Our complementary expertise enables us to support clients through every stage of their business journey.’ This holistic support extends from market analysis to mergers, acquisitions, IPOs, and operational expansion, spanning more than 35 countries over three decades of engagement. It is a model mirrored by competitors, as clients come to expect comprehensive roadmaps rather than one-off consulting engagements.

Expert Perspectives and Future Trajectory

Expert analysis from the Under Secretary for Economic Affairs affirms the US continuing role as the premier FDI destination but acknowledges that ‘slowbalization’ is leading to a more measured investment cycle. According to the Office of the Under Secretary, greenfield and M&A activity is now more targeted, with foreign entities prioritising sectors aligned with growth, sustainability, and advanced technology adoption as noted by UNCTAD . These findings resonate in the demand for advisory services that offer both high-level policy expertise and detailed local support.

In practical terms, companies considering US entry are increasingly focused on securing guidance that can bridge differences between their origin markets and the complexities of American business. The Sumihiro Investments–EDGE Partners collaboration is positioned as a response to this need, pooling networks and experience to address evolving client expectations.

Implications for International Market Entry

With US inward FDI position strong yet new inflows moderating, the environment for foreign acquisitions, greenfield investments, and expansions is best navigated with support attuned to both national and regional considerations. As competitors respond with more integrated service offerings, the market may see further consolidation among advisers seeking to provide end-to-end solutions. For international investors, the demand for accurate, up-to-date regulatory and operational guidance is not just a value-add but fast becoming a prerequisite for success. As confirmed by recent wider industry trends and supported by executive commentary, those able to blend global reach with precise, local execution are set to define the next phase of FDI growth in the United States.

Looking ahead, the sustained attractiveness of the US to foreign investors is likely to rest on the continued refinement of entry strategies, an agile response to regulatory changes, and strategic use of comprehensive business advisory partnerships. For sector leaders and newcomers alike, the imperative is clear: in a market where stakes are high and competition intense, the choice of advisory support will prove a decisive difference in capturing US growth opportunities.