Despite technical and political obstacles, Chinese business investment in the United States will keep growing fast in the near future, experts said.
“Chinese investment in the US will surely increase fast and the momentum will not be blocked,” Huo Jianguo, president of the Chinese Academy of International Trade and Economic Cooperation, a think tank of the Ministry of Commerce, said on Monday.
He added that the huge US market has advanced technology and management, providing tremendous opportunities for Chinese investors in terms of mergers and acquisitions as well as setting up plants through greenfield investments. Huo added that Chinese investment in the country will benefit both sides.
Chinese figures showed that the country’s total investment in the US surged to $9.3 billion in 2012 from $1.88 billion in 2007, while US figures said that the cumulative investment jumped from $3.4 billion to $22.8 billion in the same period, Zhao Weiping, Chinese Consul General to Chicago, said in late April.
Zhao added that in addition to the attractiveness of the market and technology, the US also has low costs for utilities and land use, and that Chinese investment in the US will keep growing, which will enhance the investors’ competitiveness.
Meanwhile, the US is advancing its SelectUSA initiative to lure foreign investment, while the Chinese government is encouraging domestic companies to invest abroad, including in the US, he added.
In recent years, Chinese investment in the US was affected by some negative factors, including the US frequent politicizing of Chinese spending and blocking transactions for so-called “national security” reasons, which is China’s greatest concern, according to Zhao.
After Chinese meat giant Shuanghui International Holdings Ltd proposed in late May to buy Smithfield Foods Inc, the world’s largest pork producer, some US senators urged the Obama administration to consider whether the proposed $4.7 billion deal – the biggest takeover of a US company by a Chinese firm ever – posed a threat to the US food supply that could justify blocking it.
China and the US will hold the fifth Strategic and Economic Dialogue, or S&ED, on Wednesday and Thursday in Washington.
The Chinese ambassador to the US, Cui Tiankai, said in a Monday news conference that the bilateral investment pact will be a very important topic for the upcoming talks.
China and the US officially launched the negotiations on a bilateral investment treaty in 2008. The ninth round of talks was concluded in early June.