Chinese foreign direct investment (FDI) in the US hit record levels in 2012 and shows little sign of slowing, despite worries that the inflow of Chinese money presents a growing security risk to the country.
Beijing: Chinese foreign direct investment (FDI) in the US hit record levels in 2012 and shows little sign of slowing, despite worries that the inflow of Chinese money presents a growing security risk to the country.
According to a new report by New York-based Rhodium Group, which tracks Chinese foreign direct investment (FDI), Chinese companies concluded deals worth $6.5 billion in 2012, an increase of 12 percent from the record USD 5.8 billion in 2010, China Daily reported.
Thilo Hanemann, Rhodium's research director, said he believed the result reflected both the growing determination of Chinese firms to expand overseas, and attractiveness of the US markets and assets to investors.
The most appealing US sectors to Chinese investors were oil and gas exploration, advanced manufacturing that helps Chinese firms move up the value chain, and assets that allow investors to gain solid returns such as utilities, real estate and hospitality, it said.
A number of major Chinese FDI deals are still awaiting regulatory approval in the US, signaling that the growth is expected to continue into 2013.
The Rhodium report highlights that the fast-growing Chinese FDI was in fact one of the few bright spots in a gloomy year for the US economy, which has seen overall global FDI decline sharply since 2009 and the outbreak of global financial crisis.
The UN Conference on Trade and Development said in October that China edged out the US to become the world's top FDI destination in the first half of 2012, but added the US may return to the top spot during second half of the year, or July onwards.
While FDI in the US from Europe and Canada declined by more 50 percent in the first three quarters of 2012, China was among the few countries that has now increased investment in the US for five years running, figures from the US Bureau of Economic Analysis show.
The figure represent a rise of more than 300 percent in that time.
Chinese majority-owned businesses in the US now employ 29,000 people, up from fewer than 10,000 five years ago.
This figure could run into many more thousands if jobs created by firms with minority Chinese investment, and other indirect jobs created by Chinese FDI, were taken into account.