You can find out more about our use, change your default settings, and withdraw your consent at any time with effect for the future by visiting Cookies Settings, which can also be found in the footer of the site. And while the U.S. grants China permission to buy its companies, China does not allow U.S. companies to operate the same way on their soil. This intervention by the PBOC results in scarcity of U.S. dollars, which inflates their exchange rates. Its three main sites Taobao, Tmall and Alibaba.com have hundreds of millions of users, and host millions of merchants and businesses. The first and most important is that China wants its currency, the yuan, pegged to the dollar. It has opened yuan trading centers in London and Frankfurt. The ideal entry-level account for individual users. USDA reported in 2018 that Chinas agricultural investments in other nations had grown more than tenfold since 2009. There are two main economic reasons Chinese lenders bought up so many U.S. Treasury securities. Walmart Inc. is the largest retailer in the world and one of the five largest corporations in the world by sales. US President Joe Biden, King of Jordan II, for the "historic meeting" between Palestinians and Israelis in Aqaba. A2: On a large scale, these acquisitions do not represent a substantial enough portion of food production in the United States to threaten national food security. Then you can access your favorite statistics via the star in the header. Access to this and all other statistics on 80,000 topics from, Show sources information This helps inflate the value of the dollar. While such purchases in low- and middle-income countries have been coveredextensively, they also happen here in the United States. What's the Difference? China's low-cost competitive strategy seems to be working. (2021, September 2). World Gold Council. Countries with lower currency values export more, since their products cost less when sold in foreign countries. Policymakers should, instead, consider the many threats facing the future of the U.S. food system and ensure that current and aspiring farmers have the resources they need to secure long-term U.S. food production, starting with access to affordable farmland. National Association of Realtors. ", The World Bank. Bipartisan pressure is building to stop foreign nationals from purchasing American farm operations and receiving taxpayer subsidies. The other countries that hold the most U.S. debt include the U.K., with $634 billion owed; Switzerland, holding $294.1 billion in debt securities; and the Cayman Islands, slightly behind Switzerland with $293.2 billion of the United States' debt. Powered and implemented by FactSet Digital Solutions. Should the PBOC stop interfering, most economists agree that the renminbi would self-correct and appreciate in value, thus making Chinese exports more expensive. Nations borrowing from each other may be as old as the concept of money. https://www.thoughtco.com/how-much-debt-does-china-own-3321769 (accessed March 4, 2023). Foreign investors by the end of 2019 held an interest in more than 35 million acres an area bigger than New York State. "Major Foreign Holders of Treasury Securities. To use individual functions (e.g., mark statistics as favourites, set "The number is very difficult to gauge correctly due to complicated ownership structures that the Chinese sometimes employ. But the company backed out of its contract with USDA after an outcry from lawmakers led by Sen. Chuck Grassley (R-Iowa). These are especially vital not only for high-technology products such as smartphones and electric vehicles but for U.S. frontline weapons including the F-35 fighter, which requires 920 pounds of rare earth minerals. It receives these dollars from Chinese companies that receive them as payments for their exports. "How Much U.S. Debt Does China Really Own?" Those seeking more restrictions say USDAs numbers actually understate the amount of foreign control over American ag operations. CLICK HERE FOR COMPLETE CORONAVIRUS COVERAGE, Times Square billboard endeavors to warn of creeping Chinese influence. Other foreign holders included oil-exporting countries and Caribbean banking centers. That would hurt China's competitiveness by raising the yuans value relative to the dollar. Focusing narrowly on land purchases by Chinese companies or other foreign entities will not address the full scope of this problem. Outward FDI stock share of state-owned and private enterprises in China 2011-2021 FDI outflows from Chinese central enterprises in non-financial sectors 2011-2021 Value of Chinese FDI flows to the . Federal Reserve Bank of St. Louis. July 20, 2021 Ryan Morgan U.S. lawmakers are acting with increased concern as Chinese purchasers are buying tens of thousands of acres of U.S. farmland. Maxwell said that poses a big risk with an older generation of farmers set to exit the industry. Before June 2010, Treasury reports showed that China held about $843 billion in debt. The amount of farmland owned by Chinese investors has remained relatively steady in recent years, according to the AFIDA data. As a Premium user you get access to background information and details about the release of this statistic. And its findings may be surprising to some. This statistic is not included in your account. These include white papers, government data, original reporting, and interviews with industry experts. While some states have strict laws in place, others are more open to foreign investments. What is the highest credit limit for Chase Sapphire? The source adds the following information: "estimates from 2010 thru 2015 include some commercial transactions. The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Across the country, the 2013 purchase of Smithfield Foods by the Chinese firm Shuanghui, now called WH Group, received national attention and escalated concerns about Chinese intervention in U.S. food systems. We are new in this process, said Rep. Sanford Bishop (D-Ga.), chair of the agriculture appropriations subcommittee. That data also shows that the approximately 190,000 acres of farmland owned by Chinese interests has remained virtually unchanged since 2013. You can only download this statistic as a Premium user. 1616 Rhode Island Avenue, NW The top two foreign holders of U.S. debt are Japan and China. [U]nder Xi Jinping, the Communist party has returned to being the ultimate authority in business," writes The Guardian. Indeed, there has been a tenfold expansion of Chinese ownership of farmland in the United States in less than a decade. A3: The only federal law governing these transactions is the Agricultural Foreign Investment Disclosure Act (AFIDA) of 1978. China, on the other hand, accounted for more than 80 percent of the world's supply," the report stated. By artificially keeping the value of the yuan down, the government reduces the buying power of the Chinese middle class, thus making the sale of exports vital keeping the countrys economy moving. Well, really, the hallmark has been an almost otherworldly disconnection from the actual affairs of the United States. That figure was$30.5trillion as of June 30, 2022. But some analysts believe the ongoing crisis lays bare the inroads China has made on U.S. soil. Ever since the establishment of theBretton Woods Systemin 1944, the value of Chinas currency, the yuan, has been connected or pegged to the value of the U.S. dollar. Even so, large land purchases present various localized concerns in the places where they occur. How Much Is the Per Capita Money Supply in the U.S.? Although Walmart does own an impressive number of brands both in the US and beyond, the company does not own Lowes. China is also responding to accusations of manipulation. As of the start of 2020, Chinese investors owned about 192,000 acres of U.S. agricultural land valued at about $1.9 billion, according to Politico. Agricultural Land: Facts, Figures, and an Assessment of Real Threats, Brzezinski Chair in Global Security and Geostrategy, Diversity and Leadership in International Affairs Project, Energy Security and Climate Change Program, Media Relations Manager, External Relations. "A recently passed law in China requires companies toshare data with Chinese communist spy agenciesif requested. | Citing staff shortages, the Department of Agriculture didnt penalize foreign parties for violating reporting rules from 2015 to 2018, prompting 28 lawmakers to criticize the departments complete lack of accountability and oversight Monday in a letter obtained by the Wall Street Journal. I'm a reporter for Forbes' explainers and trends team. As a presidential candidate in 2019, Warren said she would support a national version of Iowas law along with safeguards against foreign investors using fake American buyers to circumvent the rules. WH Groups shareholders include many large U.S.-based financial institutions.". Countries Who Own The Most Acres U.S. U.S. companies with Chinese shareholders more than doubled their acreage that year, accounting for 102,000 acres of the growth. Times Square billboard endeavors to warn of creeping Chinese influence. The products are still made in the USA, but the decisions are made in China. As Chinese investors buy up U.S. Treasury products, they help increase the value of the dollar. What US companies are now owned by China? You need a Statista Account for unlimited access. Walmart owns no shares. That's a large portion of the $7.6 trillion in Treasury bills, notes, and bonds held by foreign countries. "How Much Money Does the World Owe China? Many large corporations, pension funds, and wealthy individuals are investing in agricultural land in the United States and abroad. 2021 by the Center for Strategic and International Studies. For example, foreign investors can set up limited liability companies in the U.S. and designate an American owner to circumvent the reporting requirements while still controlling the operation behind the scenes, said Joe Maxwell, president of the progressive advocacy group Family Farm Action. Breaking Down the US Debt and Who Owns It. The United States owes China approximately $980.8 billion as of May 2022. Representative Grace Meng expressed concern that the amendment could fuel already rising anti-Asian hate, and the USDA and advocacy groups have pointed out that the USDA does not have the authority to intervene in private land deals. A dollar-pegged yuan helps keep down the cost of Chinese exports, which the Chinese government believes makes it stronger in international markets. The PBOC can print renminbi as needed. (July 18, 2022). 3 1. Chinese firms have bought AMC Entertainment, Legendary Entertainment, and other media companies. Chinese lenders snap up so much of the U.S. debt for one basic economic reason: protecting its dollar-pegged yuan. Center for Strategic and International Studies On Friday, Starwood Hotels agreed to be acquired by Anbang, a Chinese insurance company that is rapidly buying up U.S. hotels, for over $13 billion . China held 1.1 trillion U.S. dollars in U.S. securities. Financing for these huge annual IOUs comes from the Department of the Treasury and the Federal Reserve. Definition and Impact. Of the 109 countries that own U.S. agricultural land, China ranks No. | The American Security Institute recently released a report and launched a campaign, featuring a billboard in Times Square, to draw further attention to the extensive array of sectors the Chinese government and its partners have invested into. "How Much U.S. Debt Does China Really Own?" The Global Food Security Program would also like to thank Aliza Lauter for her research contributions to this publication. Crops beings harvested on an Iowa farm in 2018, Weak Oversight of Foreign Farmland Deals Sparks Concern Amid China Purchases, North Dakota Turns Against Chinese Corn Mill Project. The last significant increase in acres occurred between 2012 and 2013 . "Debt Position and Activity Report, June 2017," Page 1. (Smithfield said in a later statement pertaining to their ownership structure that they are "a U.S. company that provides more than 40,000 American jobs and partners with thousands of American farmers. Q2: What threats do foreign acquisitions of U.S. farmland pose? Additionally, China is seeking to build 5G networks in the United States and other Western countries, which could potentially feed personal information and sensitive data to the Chinese Communist Party. By mid-2017, the total amount of official debt owed by the federal, state, and local governments was more than $19.8 trillion. The other 189,000 acres were worth $235 million when purchased and are owned by 62 U.S. corporations with Chinese shareholders. As soon as this statistic is updated, you will immediately be notified via e-mail. Why China Buys U.S. Debt With Treasury Bonds, A Look at National Debt and Government Bonds, National Debt: Definition, Impact, Key Drivers, Current U.S. Debt, 2020 Election: The Key Economic Issues Explained. Data cover both foreign-owned (29.1 million acres) and U.S. This has been common practice for many countries ever since the Bretton Woods Conference in 1944. RT @lillybug000: How much more does any American have to see to realize our government is owned by China. China produces 97 percent of U.S. antibiotics and about 80 percent of active pharmaceutical ingredients used in American drugs, giving the Chinese Communist Party absolute controlof potentially life-saving medicine. The committee unexpectedly adopted Newhouses amendment to the Agriculture-FDA spending bill (H.R. Chinas demand for Treasurys helps keep U.S. interest rates low. While Japans 4.8% ownership of the U.S. debt is only slightly less than Chinas 5.3%, the Japanese-owned debt is rarely depicted in a negative light, as is Chinas. The offers that appear in this table are from partnerships from which Investopedia receives compensation. In addition, the U.S. Treasury Department has a proven track record of being able to find new creditors very quickly when needed.
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