Latest In

News

China Moves From U.S. Treasuries to Foreign Direct Investments

The recent news that China dumped $34.2 billion in U.S. Treasuries in December hardly made a splash, but L.A. Times writer Don Lee wondered what China did with

Jul 31, 2020
50.3K Shares
1M Views
The recent news that China dumped $34.2 billion in U.S. Treasuries in Decemberhardly made a splash, but L.A. Times writer Don Lee wondered what China did with all that extra cash. He foundthat it was investing the money in private companies throughout the world. China poured $43.3 billion into foreign direct investments in 2009 and, according to U.S. Treasury figures, it actually shed $45.1 billion in U.S. Treasuries in the last half of 2009.
Not that China’s private investments were primarily American: Experts estimate that, while China bought stock in everything from a theater in Branson, Mo., to Coca-Cola, its total direct investments in the U.S. in 2009 ranged between $3.9 and 6.4 billion. That amounts to a total of about 3 percent of all the foreign direct investment in the United States in 2009.
China’s foreign direct investments have cost it in the past: The political fallout from an attempt by the state oil company to buy Unocal in 2005 met with stiff resistance (and ultimately failure) in Washington; an effort to buy into American financial services companies thereafter led to massive losses in 2008. Now the Chinese are buying up newly cheap real estate. But rather than court the negative attention received by Japanese real estate investors in the 1980s, Chinese investors are focusing on stock purchases and less prominent properties while partnering with American companies, according to Lee. Whether an increasingly protectionist American populace feels better about a Chinese-owned factory than a Japanese-owned real estate landmark, however, remains to be seen.
Dexter Cooke

Dexter Cooke

Reviewer
Dexter Cooke is an economist, marketing strategist, and orthopedic surgeon with over 20 years of experience crafting compelling narratives that resonate worldwide. He holds a Journalism degree from Columbia University, an Economics background from Yale University, and a medical degree with a postdoctoral fellowship in orthopedic medicine from the Medical University of South Carolina. Dexter’s insights into media, economics, and marketing shine through his prolific contributions to respected publications and advisory roles for influential organizations. As an orthopedic surgeon specializing in minimally invasive knee replacement surgery and laparoscopic procedures, Dexter prioritizes patient care above all. Outside his professional pursuits, Dexter enjoys collecting vintage watches, studying ancient civilizations, learning about astronomy, and participating in charity runs.
Latest Articles
Popular Articles