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Why The Chinese Cannot Invest In The United States

By on January 12th, 2020 Under INVESTMENT | Download Naija Music

The American Enterprise Institute and the Heritage Foundation’s China Global Investment Tracker follows large Chinese investments, excluding bonds, around the world. The leading recipient of these kinds of investments is the United States, which received over $180 billion from January 2005 through June 2019. Chinese investment in 2019 is on pace to reach just $5 billion. The US has now passed legislation limiting Chinese access to not only technology but also personal data, so the 2017 spending level of $25 billion will be difficult to regain. The deals described in the tracker are worth $100 million or more.

More important, they are voluntary transactions that let Americans make their own choices. Chinese purchases benefit Americans who hold desirable assets—city property and large corporations but also individual family homes (not in the tracker). Chinese investment helps support a small number of American jobs. However, China is not a friend. The US certainly should not ban Chinese investment, but, as Congress has directed, Chinese firms and individuals should not be permitted to buy advanced technology that could have military uses. Chinese firms that receive stolen intellectual property should be punished. Most Chinese firms have little familiarity with a competitive market under rule of law, so their ability and willingness to obey the law are in doubt. In particular, Chinese firms cannot be trusted with Americans’ personal data. With these guidelines, Chinese investment in the US can be positive for both countries.

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