Editor’s note: Transportation Secretary Anthony Foxx joined FedEx Freight President and CEO and U.S. Chamber Board Chairman Michael Ducker on April 12 for a conversation about transportation investment at the inaugural Invest in America! Summit.
There is a clear nexus between foreign investment in America and U.S. transportation and infrastructure investment needs. They go hand in hand – and need to remain a priority moving forward.
Late last year, President Barack Obama signed the FAST Act (Fixing America’s Surface Transportation Act) into law. With its enactment, Congress provided – for the first time in over ten years – dedicated, multiyear funding for surface transportation and freight infrastructure. Thanks to Transportation Secretary Anthony Foxx’s leadership, these investments will help to address some of our country’s current transportation infrastructure needs and, as a result, will support countless businesses across the country that rely on this infrastructure to move goods both within our borders and across the globe.
Even with this success, gaps in transportation investment remain. The U.S. Federal Highway Administration estimates that between $124 billion and $146 billion annually in capital investment will be needed for substantial improvement in conditions and performance – considerably more than the current $100 billion spent annually on capital improvements at all government levels. The bottom line is that we are underfunding critical infrastructure by almost 50%. This is a real concern to companies like FedEx that drive the economy through the movement of goods. Fortunately, foreign investment can be an important part of the solution.
The U.S. is home to the largest amount of Foreign Direct Investment (FDI) in the world, with nearly $200 billion international investment annually. For example, in 2013 alone, the Tennessee Department of Economic and Community Development projects accounted for 52 commitments from foreign-owned businesses that created 9,215 jobs and $1.68 billion in capital investment.
While transportation and infrastructure are currently benefiting from these international investments, we need to encourage even more focus on these areas, from identifying suitable transportation projects and encouraging the development of project deals for investors to consider, to whether U.S. laws and regulation leave enough room for innovation to attract outside the box business solutions to our infrastructure needs.
The contribution of international investors to the economic success of the United States is substantial. In times of limited budgets and ever-growing transportation infrastructure needs, FDI investment in the transportation sector can be an important component to our continued growth, helping us bridge the gap on surface transportation and infrastructure funding and better facilitating the flow of goods throughout the United States.