Driving FDI Performance in 2025: Strategic Actions for IPAs and EDOs

Executive summary

In 2025, Investment Promotion Agencies (IPAs) and Economic Development Organisations (EDOs) face both heightened competition and unprecedented opportunities to attract Foreign Direct Investment (FDI). Rapid advancements in artificial intelligence (AI), a growing emphasis on data-driven strategy, and the imperative for proactive investor outreach have transformed the investment promotion landscape.

To thrive in this evolving environment, we have identified eight priority actions that will boost organisational performance and increase FDI inflows:

1. Prioritising Business Retention and Expansion (BRE)
2. Embedding AI Across Operations
3. Setting Clear FDI Targets and Implementing CRM Systems
4. Establishing Staff Performance Incentives to Foster Excellence
5. Developing a Robust Business Development Plan
6. Prioritising Having a Lead Generation Function
7. Developing a Clear Strategy for Investment Multipliers
8. Crafting Sector-Specific Investment Attraction Strategies

By taking these eight strategic actions, leaders of IPAs and EDOs can establish a performance-driven culture that not only attracts more investors but also delivers long-term value for their locations.

Action 1: Make business retention and expansion (BRE) a top priority

Our recent survey and report in collaboration with City Nation Place revealed that existing investors’ recommendations are among the most compelling endorsements for a location’s attractiveness. Despite this, Business Retention and Expansion (BRE) activities are often underestimated. BRE teams often lack sector focus, industry knowledge, and strong engagement with key decision-makers at regional or corporate headquarters—leading to major missed opportunities. This is especially important in our current economic environment, where tariffs and other policies pose challenges to operating environments worldwide.

Actions to consider

• Design a targeted BRE program: Identify key accounts and prioritise them based on strategic criteria such as company size, sector, and investment scale. Clearly define the services available at both national and local levels.
• Adopt a unified account management approach: Assign key account managers to build trusted relationships with strategic accounts. Encourage overseas offices to coordinate and support head offices. Key accounts should also be coordinated with other key government stakeholders (e.g. national IPA, state or local EDOs, and Ministries) who are also engaging with these major investors.
• CRM Integration: Use a shared CRM to document all communications and ensure transparency among government agencies. Involve relevant ministries or partner organisations when specialised support is needed.
• Leverage existing investors as ambassadors: Satisfied investors often become champions for your location, providing testimonials and peer recommendations. Cultivating relationships with established investors not only prevents churn but also unlocks new opportunities.

By institutionalising BRE processes, IPAs and EDOs can turn existing investors into long-term partners and create a positive feedback loop that supports new investor attraction.

Action 2: Implementation of Artificial Intelligence (AI)

IPAs and EDOs have grappled with how best to leverage AI. The most advanced organisations have experimented with chatbots for enquiry-handling, AI-powered CRM automation, big-data analytics, and predictive intelligence on sectors and markets. However, these initiatives have been costly and complex, often limiting their adoption to a small subset of well-resourced agencies.

In 2024, the release of ChatGPT-4 and similar tools ushered in a new era of transformational AI, dramatically reducing cost and complexity. This breakthrough made it feasible for practically any IPA or EDO to integrate AI in a cost-effective way, with tangible improvements in productivity and performance across the organisation.

Actions to Consider

If there’s one strategic move that leaders of IPAs and EDOs should make in 2025, it is to adopt AI throughout their operations. Drawing from our experience advising and implementing AI in multiple agencies, here are four high-impact use cases—based on tools like ChatGPT-4 or similar solutions—that can be implemented rapidly and inexpensively:

• Sector research and content creation: AI can enhance sector research and content creation for IPAs. AI significantly boosts speed and access to information, supporting the generation of sector insights for marketing materials. This can then be reviewed and improved upon by IPA staff.
• Website updating traditionally, refreshing client website content is laborious, time-consuming, and expensive. AI dramatically streamlines this process. With guidance and proper review, existing content can be updated, refined, or rewritten in minutes, ensuring websites remain current and accurate. Most IPA and EDO websites suffer from outdated content—an issue AI can resolve quickly and cost-effectively.
• Business intelligence IPAs and EDOs can use AI to identify target companies, validate sector and market focus, and develop comprehensive lead lists. Even smaller agencies with limited budgets can leverage AI to deliver highly effective results.
• Investor outreach investment promotion managers often devote substantial time to creating outreach materials. AI is a game changer in this area. Integrations with LinkedIn Sales Navigator and Apollo have made it easier than ever to locate and contact the right people with targeted messaging.

It’s important to note that AI is still in its early stages and requires oversight. All AI-generated output should be cross-referenced, with links to sources verified before being presented externally. When used responsibly, AI stands to revolutionise the way IPAs and EDOs handle research, outreach, and investor engagement.

Action 3: Target setting and CRM implementation

Without clear targets, it’s nearly impossible to measure organisational performance or effectively drive FDI growth. Multiple studies—including those our consulting team have conducted for Invest Hong Kong and Global Affairs Canada | Affaires mondiales Canada —highlight best practices in FDI target setting and key performance indicators (KPIs). Yet, many agencies need guidance when establishing and tracking meaningful targets.

Actions to Consider

• Track your investment results: A common issue is the lack of systematic data on how much FDI an organisation or region actually attracts. If you do not know your current FDI levels, setting realistic targets becomes guesswork—akin to running a business without knowing its revenue or sales figures. The first crucial step is to start recording your organisation’s investment outcomes. Numerous resources exist to guide CEOs on what to measure and what constitutes success; we also advise clients globally on defining and monitoring FDI results. However, to manage this effectively, you need a fit-for-purpose CRM. Many IPAs and EDOs still rely on outdated systems that cannot capture the full pipeline or track performance metrics. That’s why we developed Amplify CRM, a low-cost, highly customisable platform tailored specifically to IPA and EDO requirements.
• Define appropriate FDI targets: Once you are tracking outcomes, the next challenge is determining the right targets. The most common performance indicator is the annual number of FDI “successes” (i.e., announced projects) facilitated, often followed by the expected long-term job creation. The number of attracted FDI projects typically correlates directly with an agency’s proactive outreach and facilitation efforts. For smaller locations, job counts may fluctuate dramatically if a single large project dominates the annual total; in larger jurisdictions, setting a jobs target is more practical. Many agencies also track capital investment (capex)—particularly relevant in capital-intensive sectors or when investment flows aren’t dominated by one-off mega-projects (e.g., energy, mining, data centers). At a national or federal level, some IPAs additionally measure official FDI inflows, a metric distinct from greenfield FDI. This is most useful where greenfield projects account for the bulk of overall FDI or when the agency’s mandate covers large-scale initiatives (e.g., infrastructure or PPP projects) that significantly impact total FDI figures.

Action 4: Set staff performance incentives that foster a culture of excellence

Attracting FDI is largely a people business that relies heavily on the capabilities and motivation of an agency’s team. Budgetary and human resource constraints pose challenges to many IPAs and EDOs, often leading to high staff turnover, loss of institutional knowledge, and weakened long-term relationships. Building and retaining a strong team is therefore crucial for sustaining FDI attraction outcomes.

Actions to Consider

IPAs and EDOs must create an organisational framework and incentive structure that attracts, retains, and motivates top talent—while also aligning individual performance with mission-critical objectives. Effective approaches include:

• Promotion opportunities: Tie promotions to measurable achievements like attracting high-value projects or exceeding service-delivery standards. Clear, merit-based promotion paths help retain top performers.
• Accelerated career paths: Identify high-potential staff and offer fast-track career development for those consistently meeting or exceeding targets.
• Mentorship programs: Pair top performers with senior leadership mentors. Encourage exposure to private-sector stakeholders and early leadership of teams or strategic initiatives.
• Global market exposure: Allow staff to travel internationally for road shows, trade missions, or cross-agency exchanges. Encourage top performers to represent the agency at global investor or industry events.
• CRM integration: Link CRM reporting to overall organisational objectives and ensure senior management reviews these metrics regularly. Reward staff who diligently update the CRM and use data-driven insights to improve investment outcomes.

Action 5: Develop a Business Development Plan

A surprising number of IPAs and EDOs lack a clearly defined annual plan for their core investment promotion activities. Many find business planning challenging due to unpredictable funding and limited independence from government ministries, which often leads them to react to ad-hoc missions or events rather than drive a focused FDI strategy.

As a result, agencies may end up targeting suboptimal sectors, markets, or even the wrong companies—ultimately squandering valuable time and resources. Without a well-structured plan, organisations risk diluting their impact and missing high-potential FDI opportunities.

Actions to Consider

• Establish a long-term strategy: Gain approval from your reporting ministry or department for a three-year (or at least multi-year) investment promotion strategy. Given that FDI attraction typically spans years rather than weeks or months, a longer horizon helps maintain focus on strategic goals and results.
• Create an annual plan: Even a concise yearly plan, outlining key target sectors, segments, markets, and priority activities, provides a vital roadmap. This document becomes the touchstone for your agency’s actions, ensuring staff stay on track and can push back—or request additional resources—when ministry demands fall outside strategic priorities.
• Evaluate events and trade shows carefully: IPAs and EDOs frequently invest in events and trade shows misaligned with their targeted sectors and markets or attended by the wrong types of companies. Moreover, many focus too heavily on having a booth rather than scheduling quality meetings with prospective investors. Ensure you focus on the right shows and events and on direct engagement and one-on-one discussions with investors.
• Align with clear targets: A robust annual plan should tie directly to your FDI targets, ensuring that each activity supports specific, measurable goals. This results-oriented approach fosters a performance-driven culture, where every event, mission, and outreach campaign are evaluated against the potential return on investment.

By crafting and adhering to a well-defined business development plan, IPAs and EDOs can move away from reactive tactics toward a more strategic, results-focused approach—maximising resources and delivering stronger FDI outcomes for their regions.

Action 6: Prioritise having a lead generation function

Once the fundamentals are in place—an open business environment and an IPA/EDO capable of guiding investment projects from inquiry to aftercare—securing FDI often depends on proactive outreach. It is this proactive approach that puts a location on the radar of investors who might not otherwise consider it.

Investor outreach can take many forms:

• In-person: Visiting investor headquarters, attending trade shows and exhibitions, or hosting FDI events (locally or abroad).
• Virtual: Leveraging online meetings, a practice that has become more widespread since the pandemic.

If you have established global offices, assisting them with lead identification and maintaining close connections with HQ is important. However, many IPAs and EDOs lack the resources to build and manage such networks. Maintaining in-house teams with deep expertise in multiple countries, time zones, languages, and local networks is sometimes impractical.

In many cases, outsourcing investor outreach to specialised lead generation vendors is a cost-effective solution, enabling IPAs and EDOs to focus on investor facilitation and servicing to close deals. That said, it’s crucial for leaders of IPAs and EDOs to understand how to get the most value out of these vendors—and ensure that once high-quality leads are identified, their teams do everything they can to nurture and close those opportunities.

Actions to Consider

• Recognise the value of specialised outreach: A thriving industry has emerged to help IPAs and EDOs with investor outreach programs, from online meeting programs through to arranging international “road shows” to booking meetings at trade shows and events and recruiting participants for webinars and seminars.
• Adopt a blended approach where appropriate: Larger IPAs often maintain offices in the key priority markets but use vendors for additional coverage elsewhere. Even agencies with robust in-market teams allocate lead generation budgets to specialised vendors for targeted campaigns. This allows IPAs to maintain a high level of investor engagement while containing costs in less essential markets.
• Drive internal conversion efforts: While vendors can identify and pre-qualify leads, closing the deal hinges on your in-house teams. They must provide timely, high-quality information and follow-up to keep investors engaged. Weak follow-up and poor nurturing are among the most common reasons why outreach campaigns fail. To avoid this, CEOs or Directors of Investment Attraction should ensure: 1) Clear KPIs for follow-up and conversion; 2) A CRM configured to track leads through each stage of the pipeline; and 3) Regular reporting on lead status, with action plans to accelerate closing.
• Measure and optimise: Vendors can offer strategic insights into which sectors, markets, and events are most fruitful. They can also identify decision-makers with expansion plans. By coupling vendor expertise with effective internal processes, IPAs and EDOs significantly improve their chances of turning leads into real investments.

In short, lead generation vendors can extend your outreach capacity and help you target the right investors in the right places. However, their efforts must be matched by strong internal follow-up and facilitation to ensure that qualified leads are ultimately converted into successful FDI projects.

Action 7: Develop a clear strategy for investment multipliers

“Investment multipliers” are organisations or networks that can influence FDI decisions and support the activities of IPAs and EDOs to promote their location for FDI. Examples of multipliers include site selectors, location advisors, business and industry associations, overseas chambers of commerce, counterpart government agencies overseas, and diaspora networks. Multipliers can be influential in unlocking key investor networks.

Despite their potential, many IPAs and EDOs have limited knowledge of how multipliers influence FDI decisions and how they can be leveraged to promote their location. Most IPAs and EDOs lack a strategic approach or do not have clear engagement plans for multipliers. Many IPAs and EDOs also do not have a good overview of new and emerging intermediaries in their target markets.

Actions to Consider

• Map out and prioritise key multiplier groups: Identify relevant site selectors, industry associations, chambers of commerce, diaspora networks, and counterpart government agencies most relevant to FDI in your location and in your source markets. Segment them by multiplier category, sector, and geographic location to prioritise engagement. Multipliers can also be tiered based on their strategic importance and connection to investor groups.
• Develop tailored engagement plans: Design specific engagement plans for each group, highlighting mutual benefits (for example, access to data, co-branding or joint events and joint marketing initiatives). Provide them with marketing collateral and data-driven insights that they can share with their network.
• Provide training and support: Ensure multipliers understand your location’s unique value propositions for their network, and incentives and the services your IPA or EDO offers. Equip them to be strong advocates on your behalf.
• Establish clear points of contact: Assign dedicated account managers to maintain ongoing relationships with each multiplier group and propose new activities or initiatives. Use a CRM tool to track interactions and outcomes.
• Assess multiplier value-add: Track the number and quality of leads generated from each multiplier relationship. Review multiplier relationships on an annual basis. Allocate more resources to top-performing groups and refine engagement strategies for less effective ones.

By systematically engaging these influential networks, IPAs and EDOs can significantly expand their outreach capacity and secure higher-quality leads.

Action 8: Develop sector-specific attraction strategies

Many IPAs and EDOs struggle to pinpoint clear sector and sub-sector priorities. This often results in broad or generic marketing (for example, “Advanced Manufacturing” or “Cleantech”) rather than targeted value propositions. As a result, overseas promotion becomes less effective, and valuable resources are allocated to lower-impact prospects.

Actions to Consider

• Conduct a detailed sector prioritisation analysis: Use data on market size, growth trends, alignment with local value chains, and broader economic objectives to identify the top three to five sectors. Focus your resources where they can deliver the greatest return.
• Develop strong, specific value propositions: Highlight the unique advantages of your location in each targeted sector (such as specialised workforce, R&D tax credits, or cluster ecosystems). Create collateral that speaks directly to investor pain points.
• Train staff for sector-specific expertise: Equip your team with the knowledge and technical background needed to engage credibly with industry decision-makers. Encourage continuous learning to keep up with trends and technology shifts.
• Coordinate a sector-focused outreach plan: Aim your international lead generation and promotional events at the highest-potential markets for each priority sector. Align all campaigns, trade missions, and digital outreach under a cohesive sector strategy.
• Measure impact and refine: Track the number of leads, projects, and expansions secured in each targeted sector. Adjust strategies based on performance data to ensure long-term success in key industries.

Well-defined, opportunity-driven sector targeting ensures your agency concentrates resources on the most promising areas for investment and signals to potential investors that you understand their needs. IPAs and EDOs are more likely to succeed when they focus on promoting specific sectors or business activities.

Conclusion

As global competition for FDI intensifies, IPAs and EDOs must adopt proactive, data-driven, and strategic approaches to stay ahead. By prioritising BRE, embedding AI across operations, setting clear FDI targets, establishing staff incentives, building robust business development plans, optimising lead generation, strategically engaging investment multipliers, and focusing on sector-specific strategies, agencies can significantly amplify their impact. Leaders who champion these best practices—and continually refine them—will cultivate a performance-oriented culture that not only delivers immediate wins but also fosters long-term, sustainable value for their regions.

Further reading

WAIPA's Overview of Investment Promotion Findings from Annual Survey (2019)

Innovations in Foreign Direct Investment Attraction by Henry Loewendahl (2018)

A new foreign direct investment accounting methodology for economic development organizations by Henry Loewendahl (2016)

Increasing the development impact of Investment Promotion Agencies by Armando Heilbron and Hania Kronfol (2019/2020)