Chinese businesses scale back US investments amid rising tensions

  • Stock Market News
Chinese businesses scale back US investments amid rising tensions

Chinese businesses are reducing their investments in the U.S., driven by worsening bilateral relations and challenging business conditions. Rhodium Group reports that investment from China has plummeted from $48 billion in 2016 to a mere $2.5 billion in 2021.

A survey conducted by the China General Chamber of Commerce reveals that over 80% of Chinese companies, including Wanxiang America, identify the deadlock in bilateral relations as their primary obstacle. Unstable U.S. foreign investment policies have also raised concerns among these businesses.

The policies implemented by both the Trump and Biden administrations have exacerbated these issues. A growing backlash against Chinese investments is evident, with Republican presidential candidate Vivek Ramaswamy voicing criticism of Chinese battery company Gotion's planned factory in Michigan.

In 2022, the Committee on Foreign Investment reviewed a record number of transactions, with China ranking among the top investors. Yet, backlash and proposed bills restricting foreign land ownership are increasingly prevalent, as observed by the National Agricultural Law Center.

The escalating tensions have led to drastic measures such as forced divestments. Swiss seed company Syngenta had to sell its land due to its Chinese ownership following a ban announced by Arkansas Governor Sarah Huckabee Sanders. Consultancy firm LinVest warns that such state land bans undermine investment and job creation.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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