Chi­nese in­vest bil­lions in US

China Daily (Canada) - - FRONT PAGE - By AMY HE in New York amyhe@chinadailyusa.com

De­spite fears from US politi­cians and com­pa­nies about jobs be­ing out­sourced to China, Chi­nese in­vest­ment in the United States has cre­ated 80,000 jobs for Amer­i­cans, up from fewer than 15,000 five years ago, and the num­ber could reach 200,000 to 400,000, ac­cord­ing to a re­port re­leased on Wed­nes­day.

Chi­nese com­pa­nies in­vested al­most $46 bil­lion in the US be­tween 2000 and 2014, cre­at­ing more than1,500 busi­nesses in the coun­try, and the amount could in­crease to be­tween $100 bil­lion to $200 bil­lion by 2020, said the study spon­sored by the Na­tional Com­mit­tee on US-China Re­la­tions and done by the Rhodium Group. The re­port is the first de­tailed anal­y­sis of Chi­nese in­vest­ment by con­gres­sional dis­trict.

“What was a trickle has be­come a stream, and it’s prob­a­bly go­ing to be­come a river,” said Stephen Orlin, pres­i­dent of the US-China Re­la­tions com­mit­tee, a non-profit that pro­motes un­der­stand­ing be­tween the US and China, at brief­ing in New York where the re­port was re­leased.

“Chi­nese cap­i­tal is pro­vid­ing 80,000 jobs to­day, and will likely pro­vide be­tween 200,000 and 400,000 jobs at the end of this decade. It will change the way many Chi­nese and Amer­i­cans think about each other,” he added.

The top states for Chi­nese in­vest­ments are Cal­i­for­nia, Texas. North Carolina, Illi­nois and New York, ac­cord­ing to the study. Be­tween 2000 and 2014, North Carolina’s fourth con­gres­sional dis­trict re­ceived the most di­rect in­vest­ment — $3.36 bil­lion — fol­lowed by the sev­enth dis­trict in Illi­nois with $3.21 bil­lion, and the 12th dis­trict in New York with $2.25 bil­lion.

As for em­ploy­ment by Chi­nese com­pa­nies, North Carolina is No 1, with 15,000 jobs. The state has a sig­nif­i­cant num­ber of peo­ple em­ployed by Smith­field Foods, which was bought by a Chi­nese food com­pany two years ago in a con­tro­ver­sial ac­qui­si­tion. Smithfi head­quar­ters is in Vir­ginia, and it has pro­duc­tion fa­cil­i­ties through­out the coun­try.

The sec­ond-largest em­ployer in North Carolina is Hong Kong-based Len­ovo. In 2005, Len­ovo ac­quired IBM’s PC busi­ness in­clud­ing its op­er­a­tions in the Re­search Tri­an­gle.

The re­port said that in­vest­ments in per­ceived tro­phy as­sets such as the Wal­dorf As­to­ria Ho­tel dom­i­nate the head­lines, but “Chi­nese firms are clearly in­ter­ested in the value of Amer­i­can work­ers and man­u­fac­tur­ing in some of the ar­eas with the low­est per capita in­comes in the United States as well. The benefits of Chi­nese cap­i­tal are dis­trib­uted world­wide, not just in high-in­come parts of the coun­try.”

Chi­nese com­pa­nies have cre­ated the most num­ber of jobs in the man­u­fac­tur­ing and ser­vices sec­tors, which hold a higher num­ber of jobs com­pared to the en­ergy and real es­tate sec­tors, the re­port said.

“Fears that Chi­nese ac­quir­ers could sys­tem­at­i­cally move ac­quired as­sets and re­lated jobs back to China have not ma­te­ri­al­ized,” the au­thors said.

Thomasville, Alabama, is one of the cities that has ben­e­fited from Chi­nese in­vest­ment and was pro­filed in the re­port. Last May, of­fi­cials held a rib­bon-cut­ting cer­e­mony for Golden Dragon Pre­cise Cooper Tube Group’s first US fac­tory, lo­cated in Wil­cox County and cho­sen among 70 US cities that ex­pressed in­ter­ested in hav­ing the plant.

“We had peo­ple in the town who were like, ‘The Chi­nese are com­ing, the Chi­nese are com­ing!’ they didn’t know how to act, they didn’t know how to ac­cept this in­vest­ment,” re­called Shel­don Day, mayor of Thomasville, dur­ing the event. “But when they found out that Alabami­ans — our folks — were go­ing to be the peo­ple to re­ceive the jobs, then it be­came a great project for us.”

Chi­nese in­vest­ment spurs Amer­i­can in­no­va­tion and com­pet­i­tive­ness, the re­port found. Com­pa­nies from China are spend­ing mil­lions on re­search and devel­op­ment in the US and “in­no­va­tion clus­ters” in the US are ben­e­fit­ing. Tech gi­ants like Ten­cent and Alibaba, for ex­am­ple, have con­trib­uted cap­i­tal for US start-ups and early-stage growth com­pa­nies.

“Higher lev­els of in­vest­ment mark the be­gin­ning of an era of US-China eco­nomic en­gage­ment that brings a wider ar­ray of mu­tual benefits rather than a limited set of win­ners and losers, as arose from the deep­en­ing of goods trade of the past two decades,” the re­port said.

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