Roel Spee addressing a Tuesday morning workshop of the Minneapolis-St. Paul Professional Forum

First indications of third- and fourth-quarter 2009 global investment activity "show signals of increasing activity," says Roel Spee, director of IBM Global Business Services' Plant Location International unit in Brussels. Spee has been discussing the findings of the 2009 edition of IBM's Global Location Trends report with audiences at economic development gatherings in the U.S. this fall, most recently at the International Economic Development Council's annual conference in Reno, Nev., in early October, where the full report was released.

Two weeks previously, Spee shared select findings of the report with attendees of the Industrial Asset Management Council's Fall 2009 Professional Forum in Minneapolis on Sept. 22. It came as no surprise to learn that manufacturing jobs created through new foreign greenfield investment were down about 25 percent in 2008, and that 2009 numbers will be similar. The downward trend began as early as 2007, before the global recession was formally under way.

"But there are still a number of countries around the world, including the U.S., the U.K. and other mature western European markets that have been quite stable in terms of attracting investment," Spee told the IAMC audience. "One of the reasons is there has been a lot of conservation going on in the last two years. In that situation, companies go not only to low-cost locations, but very often they will concentrate in locations where they feel safe, in stable environments and where they are already invested today. That's one reason markets like the U.S., U.K. and Germany, for example, are successful in that context."

Europe and the Middle East have claimed the most new manufacturing jobs each year from 2003 through 2008 as a percentage of the worldwide total, mainly due to Eastern European activity, noted Spee. Four of the top-10 global markets for manufacturing are Eastern European: Poland (4th), Russia (6th), the Czech Republic (7th) and Romania (9th), according to IBM-PLI's data. Asia-Pacific was the second-most-active region, particularly China, India and Thailand.

Eastern Europe is not a new center of manufacturing, so some options to the traditional industrial centers are in order. Spee says new areas within the region are now worthy of consideration, including: second-tier cities in Central and Eastern Europe, with 20 to 40 percent lower costs and untapped, stable labor pools; Baltic cities, such as Riga, Tallinn and Vilnius, with lower costs than first-tier cities and stable business environments; first-tier cities in the Balkan counties, with lower costs than Central and Eastern Europe locations and untapped pools of technical skills; and the Middle East and Northern Africa.

Africa showed a fairly substantial increase in activity from 2007 to 2008. "There is growing interest in some of the African countries, where you can serve the European markets," he pointed out. Countries now emerging as manufacturing centers include Egypt, Algeria and Tunisia.

Mexico remains the primary beneficiary of new jobs created by U.S. companies investing internationally; the BRIC countries of Brazil, Russia, India and China are also active, if somewhat less so in 2008 than in previous years.

North America may see less activity, but it will see substantial activity for the foreseeable future, says Spee. "It is a market companies cannot avoid. A company that is 'globalized' simply has to be here. There will always be a flow of manufacturing jobs for that reason."

The full report is accessible at www.ibm.com/gbs/pli.