1. The Edinburgh Dialogue – Sovereign Wealth Focus 14 June 2011, Edinburgh THE FDI CONTEXT: EVALUATING THE ROLE OF SWFs Insight and intelligence from the Financial Times Ltd

2. Introducing fDi Intelligence The Financial Times Ltd’s dedicated division for FDI: fDi Magazine: reporting on the business of globalization fDi Markets: crossborder investment monitor fDi Benchmark: corporate location assessment tools fDi Reports: customised reports and data research fDi Atlas: investment incentives navigator Bespoke FDI events and investor roundtables www.fDiIntelligence.com: online portalwww.fDiIntelligence.com

3. The global macro scenario Economic/political context in which FDI has developed over the past 12 months: recovery versus upheaval Liquidity returning but resources crunch (real or imagined) continues: food, oil, water, land, rare earths M&A replaced by greenfield FDI as main form of investment, but M&A growing much faster in recovery Lower-risk, lower-cost globalisation strategies pursued by companies post- recession: JVs, alliances, partnerships Difficulty for IPAs not equipped to promote or facilitate these types of investments (more matchmaking)

4. Decline in global FDI bottoms out Global greenfield projects fell 0.38% in 2010, compared to 7.3% in 2009. Slow economic recovery, exchange rate instability and sovereign debt problems are causing companies to remain cautious in foreign expansion plans. YearProject No’sCapital investment (US$bn)* 20038,254710.23 20048,752656.08 20059,227653.64 200610,604820.69 200710,974898.88 200814,6301,401.40 200912,093892.27 201012,047748.75 Source: fDi Markets – fDi Intelligence 2011

5. fDi Intelligence expects greenfield FDI projects will grow by 6.5% in 2011 Other major manufacturing sectors should grow very strongly in 2011 – Automotive, Industrial Machinery, Metals and Chemicals in particular. Strong rebound in natural resource sectors FDI in 2011. Renewable energy should also recover in 2011 and grow strongly. Slower growth we would expect in Business Services, Financial Services, and Food & Beverages. Number of projects Source fDi Markets – fDi Intelligence 2011

6. Role of Sovereign Wealth Funds In the late 2000s, SWFs came into the spotlight, but impact on actual investment flows less significant than suggested (dwarfed by general FDI flows) Growth in importance since the crisis, as government investment promotion agencies court them as well as PE and VC funds – steep learning curve IPAs must adapt the way they promote their locations – move from selling location attributes to defining specific, profitable projects funds can invest in Best lessons come from emerging markets (esp Mideast): Jordan Investment Board two-pronged strategy Or… with resurgence of manufacturing and rebound of greenfield investment flows – perhaps a return to basics for investment attraction?

7. Contact For more information please feel free to contact me: Courtney Fingar Editor, fDi Magazine fDi Intelligence The Financial Times Ltd Tel: (+44)(0)20 7775 6365 Email: Courtney.Fingar@FT.comCourtney.Fingar@FT.com Web: www.fdiintelligence.comwww.fdiintelligence.com