Chinese ramp up purchases in U.S.

Worth of acquisitions in recent years totals billions of dollars

WaSHINGToN — In October 2014, executives from the Chinese technology company Lenovo celebrated their acquisition of Motorola by eating a deepdish pizza in Chicago.

The very same month, a little-known Chinese insurance company announced its intention to buy the historic Waldorf Astoria hotel in New York City.

These acquisitions involve just a fraction of the capital that is now flowing into the United States from China.

According to a new report by Rhodium Group, an advisory firm, and the National Committee on U.S.-China Relations, a nonprofit, Chinese companies spent nearly $46 billion on acquisitions in the United States between 2000 and 2014, with most of that activity happening in the past five years.

Between the 1980s and 2000s, the United States pumped a huge amount of foreign direct investment into China, but that investment moved largely in one direction. It wasn’t until recent years that China began returning the favor, as its economy became more developed and its companies began going abroad in search of new products, markets and talented employees.

Where has Chinese investment gone in the United States.? For the first time ever, the report tracks Chinese commercial investment in the United States at the congressional district level. Investment between 2000 and 2014 varies a lot by location, likely because of the variety of local investment targets and the district’s success at recruiting Chinese investors.

The lightest areas on the map, including all of Nevada, Idaho and Alaska, and much of New Mexico, Oregon and Florida, received between $0 and $10 million dollars of investment between 2000 and 2014.

The heaviest areas on the map, including North Carolina’s Raleigh-Durham Triangle, southwestern Texas, northwestern Oklahoma, eastern Virginia, and metro areas like Chicago, Houston, and New York City, each received more than $1.5 billion in Chinese investment in the 15-year period.

Those investments went to a wide variety of targets, including oil fields in Texas, auto parts in Michigan and video games in Silicon Valley.

Chinese investment — especially landmark purchases like that of the Waldorf Astoria — is sometimes maligned by press and politicians as the Chinese buying up American assets and shipping jobs overseas. But the authors of the study sharply disagree with this view.

According to the report, Chinese investments have generated jobs, economic growth, American innovation and competitiveness, as well as strengthening bilateral ties between the countries.

Chinese-affiliated companies now directly employ more than 80,000 Americans, up from fewer than 15,000 five years ago. Chinese investments have employed tens of thousands of more Americans on a short-term or indirect basis, for example during construction or at suppliers, the report says.

Much more Chinese investment is yet to come. Chinese foreign direct investment is only at the initial stage Japanese firms reached in the 1980s, the report says.

According to its estimates, the United States could receive between $100 billion and $200 billion of Chinese investment by 2020, increasing the number of Americans employed by Chinese affiliates to between 200,000 and 400,000 people.