How much of the U.S Does China Own

How much of the U.S does China Own

INTRODUCTION 

How much of the U.S does China Own today?

This question is very relevant as a vicious trade war rages on between the U.S and China presently is reminiscent of the Cold War period with the USSR just after the world wars that still ensures awkward relations between the U.S and Russia.

The outbreak of the global pandemic further strained relationships between both countries with accusations, investigations and the WHO being hauled back and forth between both countries.

China is notorious for buying control and they have shown it in their stranglehold of Africa through the Debt Trap which gave them very crucial access to premium real estate in these countries.

So with all this chaos and mean spirited competition going on between the U.S and China,with both fighting for global domination, exactly how much of an economic stake does China have in the U.S at the moment. 

How much of the U.S does China Own?

 

How Much United States Real Estate does China Own

industries destroyed by coronavirus

Chinese investors have been the biggest purchasers of U.S. residential real estate for six consecutive years. In all, hotels and offices remained the most popular assets. The tax benefits of real estate investing in the United States has been a major attraction for foreign investors.

Chinese investors poured $8.6 billion into U.S. hotels up from $2.8 billion in 2015. Investment in offices similarly jumped to $7.5 billion in 2016, up from $3.5 billion in 2015. 

Of the 284,000 properties sold to foreign buyers, some 40,400, or 15%, were bought by Chinese nationals. Five years earlier, Chinese nationals had purchased 23,075 homes, representing just 12% of all properties sold to foreign buyers.

China’s Anbang Insurance Group’s purchase of the Waldorf Astoria hotel for a record $1.95 billion was the poster child for this type of risky investment. 

The Company also bought Blackstone Group’s line of luxury hotels for $3.93 billion  with Ritz-Carlton locations in California, the Fairmont Scottsdale in Arizona and the Four Seasons Resort in Jackson Hole, Wyoming. 

China Life Insurance also bought a portfolio of hotels from Starwood Capital Group for $2 billion.

 

 

Top U.S Companies that China Owns

How much of the U.S does China own
Image Source: Federation of Credit & Financial Professionals

The question of how much of the U.S does China own also includes the issue of how many top U.S Companies China owns. The SEC played a major role in frustrating the Chinese bid to purchase the Chicago Stock exchange but the purchase of the rest of the American companies below have been concluded:

  • AMC
  • General Electric Appliances
  • Smithfield Foods
  • Legendary Entertainment Group
  • The Waldorf Astoria
  • Riot Games
  • Ingram Micro

 

 

How much U.S Debt does China own

How much of the U.S does China own

China currently owns about $1.1 Trillion U.S Debt. This figure amounts to about 5% of the United States national debt. The alarming rhetoric created by politicians in the minds of the masses that “China owns the U.S” as a result of it’s debt accumulation leverage is quite funny.

China owning United States Debt is far more beneficial to the United States because China buys Treasuries to help depress the value of its currency, the yuan and as a healthy source of investment. The U.S current Debt to GDP Ratio is not one of the highest in the world hence there is little cause for alarm.

A cheaper yuan makes the country’s exports less expensive for foreign buyers, thereby keeping the country’s export-based economy chugging along.

Consequently, the Chinese economy would suffer as much, if not more than, that of the United States if China were to suddenly stop buying U.S. debt.

 

CONCLUSION

The trade war between the U.S and China has helped reduce Chinese investment in the United States. However the United States government has to make the effort to scrutinise and monitor every Chinese purchase of American assets to prevent any form of “financial or economic invasion” by the Chinese.

FINANCE WORLD

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