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New Neighbors 2017 Update: Chinese FDI in the United States by Congressional District

by Thilo Hanemann | April 4, 2017

On April 25 the National Committee on U.S.-China Relations and Rhodium Group will release New Neighbors 2017, an update of their groundbreaking analysis of Chinese direct investment in the United States down to the Congressional district level. Employment and other local impacts are featured.

As Congress debates major changes to the US investment review process driven by security and economic anxieties about Chinese investment, this report provides critical objective data and perspective on the local impacts of Chinese capital, including benefits which should not be neglected.

This year’s key findings include:

  • Annual Chinese FDI tripled in 2016: Already on a steep growth trajectory for the past 5 years, Chinese investment in the United States jumped to $46 billion last year, a 200% increase from the previous record of $15 billion set in 2015.
  • Chinese companies added 1,300 US operations: Through acquisitions and greenfield projects, Chinese companies added 1,300 new US operations in 2016, bringing the total number of Chinese-owned operations in the US economy to 3,200 by year-end 2016, up from just 1,900 at the end of 2015.
  • Nearly all congressional districts now host Chinese-owned companies: By the end of 2016, 425 out of 435 Congressional Districts (98%) hosted Chinese-owned companies. The districts that have received the most Chinese investment since 2000 are NY-12, IL-07, NC-04, NC-09, KY-03, and MI-05.
  • Coastal economies still lead but Chinese presence in the South and Midwest is growing: As in previous years California and New York were the largest recipients of Chinese capital in 2016. But Chinese investors also expanded to several states that had not received significant Chinese investment before, including Kentucky, Georgia, and Arizona.
  • Chinese companies employ more than 140,000 Americans: Chinese companies added about 49,000 US employees to their payrolls in 2016, bringing the number of full-time jobs associated with Chinese companies to 141,000—a 53% increase from 2015 and more than nine times higher than 2009. And this is direct employment only, not including jobs during construction or at suppliers.
  • A cloudy 2017 outlook: After a booming 2016, 2017 is uncertain. The commercial rationale for further Chinese expansion in the United States remains strong, but Chinese balance of payments problems and capital controls, the prospect of more restrictive US policy, and an uncertain outlook for broader US-China economic relations are likely headwinds.

 

All data and information contained in this preview may be used with attribution to Rhodium Group and the National Committee on U.S.-China Relations.

For more information and event details, please visit: www.ncuscr.org/fdi.