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10 May, 2022

How has Covid-19 impacted the FDI relationship between the US and the Netherlands?

Covid-19 caused FDI levels to plummet in 2020 before a recovery in 2021, but did the relationship between the US and the Netherlands follow this pattern?

By Glenn Barklie

In 2020, the US received 1,696 greenfield FDI projects, while there were 264 projects recorded coming into the Netherlands, according to GlobalData’s FDI Projects Database.

The number of projects into the US fell sharply, decreasing by 11% from 2019. During the same period, the number of greenfield FDI projects into the Netherlands fell even further, by 24%.

US outbound FDI into the Netherlands

US-based companies created 77 projects in the Netherlands in 2020. This represented a 35.3% decrease compared with 2019.

Nominally, US-based companies primarily invested in the software and IT services, logistics, and food sectors in the Netherlands. Combined, these three sectors accounted for 43% of total US outbound FDI projects destined for the Netherlands in 2020.

Top US-based investors in the Netherlands included UPS, XPO Logistics and Alphabet (Google). Combined, these companies accounted for 6% of total project flows in 2019–20.

In terms of total US outbound FDI projects, the Netherlands ranked as the 16th-largest recipient country in 2020. It was the tenth-largest recipient in 2019.

US-based companies primarily established operations in north Holland. In fact, 46% of projects into the Netherlands by US companies were located there in 2020. South Holland and North Brabant were the next most popular subnational destinations.

Dutch outbound FDI into the US

Netherlands-based companies created 48 projects in the US in 2020. The number of projects fell by 44.8% compared with 2019.

Beverages, industrial machinery, equipment and tools, and renewable and alternative power were the top sectors in which Dutch companies were investing in the US. Combined, these three sectors accounted for 35% of total Dutch outbound FDI projects destined for the US in 2020.

Top Netherlands-based investors in the US included CitizenM, Cooperatieve Rabobank and Royal Dutch Shell. Combined, these companies accounted for 21% of the total number of Netherlands-headquartered projects established in the US in 2019–20.

The US ranked as the leading recipient country of the Netherlands' outbound FDI in 2020. It was also the leading recipient in 2019.

Netherlands-based companies primarily established operations in Texas. In 2020, 19% of all Dutch outbound projects destined for the US were created in Texas. California and Florida were the next most popular subnational destinations.

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