Follow the money: How FDI is redrawing the global economy

Foreign direct investment (FDI) has evolved from a background economic variable into a critical strategic signal for global business leaders. McKinsey partners Nick Leung and Olivia White highlight that capital flows are increasingly concentrated in "future-shaping" industries—specifically AI, advanced manufacturing, electric vehicles, and energy resources. These investments, often involving mega-deals exceeding $100 billion, serve as leading indicators for future trade patterns and competitive landscapes. While the U.S. has emerged as a primary beneficiary of this capital shift, China has transitioned toward becoming a major outbound investor. Success in these capital-intensive sectors requires robust human capital ecosystems, domestic investment support, and integration into global supply chains. CEOs must now treat FDI as a forward-looking indicator to navigate geopolitical uncertainty and avoid being left behind in rapidly shifting, technology-driven markets.