Burton Mills - Chinese Investment in the US Fell in 2017

Ahead of potential trade disputes between China and the United States, Burton Mills indicates Chinese investments in the United States dropped significantly last year.

Burton Mills - For years, Chinese companies have injected a significant amount of capital into the United States, strengthening the relationship between the world’s two biggest economies.

Analysts at Burton Mills say that in 2017 this investment decreased 36% from $46.5 billion the year before to $29.7 billion. The sharp drop in investment by Chinese entities happened well before US President Donald Trump decided to implement a series of harsh trade tariffs against China.

These measures have included hefty tariffs on steel and aluminum and the threat of tariffs to the value of up to $150 billion on various imported Chinese products.

Burton Mills analysts say China has increased regulations on outbound investment capital due to concerns that its largest entities could overextend themselves.

18 months ago, China began to implement capital controls which prevented businesses from taking part in too many US acquisitions.

Last year, China announced that it would restrict international investments by domestic firms in sectors including property, hospitality and the entertainment industry. In addition, there are more stringent regulations to contend with in the US.

The Committee on Foreign Investment in the United States, a panel with the power to overturn agreements that could give an international party control of a US entity, has become more and more aggressive under the Trump administration. Burton Mills analysts say the CFIUS has been closely monitoring a greater number of deals while also keeping a close eye on any associations that could give international firms access to sensitive data or technologies.

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Source: Burton Mills

Categories: Business News

Tags: Burton Mills, BurtonMIlls, capital controls

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