Multinational companies are increasingly widening their investments to include a number of emerging countries, with notable increases in Africa and Latin America.
This is one of the findings from IBM's Global Location Trends study, which reveals that Africa and Latin America together received about 17% of the global jobs created from foreign investment and expansion projects in 2007, compared to 13% in 2006.
Africa in particular saw considerable growth in jobs created from foreign investment, primarily in South Africa and in Morocco and Egypt in North Africa. The continent's share of worldwide job creation from foreign investment increased to 5% in 2007 from a little over 3,5% in 2006.
In Latin America, job creation from foreign investment increased by almost 6% compared to 2006, with the continent receiving almost 12% of global jobs created through foreign investment.
Within the different geographic regions, many economically emerging countries are becoming serious contenders for investment. Southeast Europe and Serbia in particular have become new major recipients of investment, as these locations increasingly are seen as alternatives to traditional Eastern European "hot spots." An analysis of jobs created from foreign investment compared to population size reveals that Bulgaria, Romania and Serbia are all ranked in the top 10 globally.
"There has been a significant amount of investment going to a range of locations that were previously 'off the map' for foreign investment projects," says Roel Spee, global location strategies leader, IBM Global Business Services. "This is a testament to the focus emerging markets have placed on building out their infrastructure to spur economic development and growth, and represents the next evolutionary step of globalisation."
The widening of investment activity also is evidenced by the fact that the top 15 countries receiving jobs from foreign investment projects are receiving less than 70% of global jobs created, compared to 73% in 2006 and 85% in 2005.
Overall, the top-ranked sector in which jobs are being created through foreign investment is transport equipment (mainly automotive and aerospace), with 200 000 jobs globally. The US was a leading investment destination for this sector with almost 22 000 new jobs, second only to Mexico with nearly 26 000 jobs. Electronics with 190 000 jobs, and Information Communications Technology with 180 000 jobs, were the second and third ranking sectors globally.
The renewable energy sector is also quickly developing into an industry of importance. Notably the solar energy sub-sector is quickly developing into a very powerful engine for economic development in multiple regions around the world, with almost 15 000 jobs created from the foreign projects announced during 2007.