But its the trend of increasing purchases and the buyers potential connections to the Chinese government that have lawmakers spooked. You can learn more about the standards we follow in producing accurate, unbiased content in our. That's when the U.S. Department of the Treasury changed how it measures the debt. In addition to federal action, some states, like Arizona, could do more to protect their local resources and communities from exploitation by domestic and foreign entities. Legal Statement. The National Young Farmers Coalition (NYFC) anticipates that two-thirds of farmland will change hands over the next decade as farmers retire, meaning that more land could become available for foreign purchase. Owning U.S. Treasury notes helps China's economy grow. Chinese billionaire and businessman Wang. China does not publish the. U.S . China, which owns an estimated $972 billion in U.S. Treasuries, is the number-two investor among foreign governments, according to the August 2022 figures released by the U.S. Treasury. How many times does Coca Cola pay dividends? But the company backed out of its contract with USDA after an outcry from lawmakers led by Sen. Chuck Grassley (R-Iowa). When the pandemic hit, Smithfield increased pork exports to China even as the United States experienced widespread meat shortages due to supply chain disruptions and Smithfield closed some of its plants due to poor working conditions. "Chinas Economic Rise: History, Trends, Challenges, and Implications for the United States.". China also became the world's biggest exporter in 2009. 1 The money flowing into agricultural real estate from other countries also makes it difficult for new farmers in the U.S. to afford land as outside buyers bid up prices. According to the U.S. Census Bureau, the U.S. has been suffering from a significant trade deficit with China since 1985, meaning that the U.S. buys more goods and services from China than China buys from the U.S. Chinese exporters receive U.S. dollars for their goods sold to the U.S. For example, Chinese pharmaceutical companies supply 70 percent of the world's acetaminophen, commonly used in Tylenol. How can I increase my credit score by 25 points? The USDA reports that the changes in pasture and crop land holdings since 2009 were mostly due to foreign-owned wind companies signing or terminating long-term leases. Whether you're an American retiree or a Chinese bank, American debt is considered a sound investment. According to USDA data, foreign investors owned at least 35.2 million acres of U.S. agricultural land in 20192.7 percent of U.S. farmland, an area almost the size of Iowa. Rep. Grace Meng (D-N.Y.) said that if the amendment was about national security, buyers from other countries should also face similar restrictions. ThoughtCo. While the Chinese, Japanese and plenty of other foreigners own substantial amounts, it's really Americans who hold most of America's debt. Chinese firms have bought AMC Entertainment, Legendary Entertainment, and other media companies. 2021 by the Center for Strategic and International Studies. "In 2017, the United States produced zero rare earth minerals. According to the data, the value of foreign-owned American assets climbed to $32.5 trillion in the second quarter, while total foreign assets held by. This includes the Federal Reserve, which already owns six times as much debt as China. Most of the rest of the U.S. debt is owned by individual investors, corporations and other public entitiesincluding foreign creditors like the Chinese government. Citing national security concerns, the House Appropriations Committee included an amendment in the recent Department of Agriculture-Food and Drug Administration spending bill that prohibits the purchase of agricultural land located in the United States by Chinese-owned companies. Owe China? It would perpetuate already rising anti-Asian hate, Meng warned at the markup. 2 This amounts to more than 13% of the U.S. debt held overseas and about 3.2% of the United States' total debt load. US Navy laments China's shipbuilding supremacy February 27, 2023; US dangles F-35 to lure India away from Russia February 27, 2023; Ukraine marks the future of remote-control war February 23, 2023; China's 'phantom space strike' made to spoof US defenses February 23, 2023; US secretly amassing killer drone swarms to repel China February . We also reference original research from other reputable publishers where appropriate. Scrutiny of foreign-owned agricultural operations receiving taxpayer subsidies has also been rising in recent years after meatpacking conglomerates like the U.S. subsidiary of Brazilian-owned JBS received millions of dollars under the Trump administrations trade bailout starting in 2018. Chinese buyers comprise one of the largest groups of foreign buyers of residential property in the United States. In 2016, HNA Group, Chinese aviation and shipping giant, bought a 25% stake for $6.5 billion. By the start of 2020, Chinese owners controlled about 192,000 agricultural acres in the U.S., worth $1.9 billion, including land used for farming, ranching and forestry, according to the. Concern about Chinese purchases of U.S. agricultural land increased in late January when the China-based Fufeng Group Ltd. was prevented from building a cornmill on land close to a North Dakota Air Force base after officials called it a security risk. Every year since 2010, China has held more than $1 trillion in U.S. debt. Here's a quick and fascinating breakdown by total. US National Debt Clock: How Its Warning Affects You. Accessed March 04, 2023. https://www.statista.com/statistics/611020/total-number-of-properties-purchased-by-chinese-buyers-in-the-us/. Q5: What is the real threat to U.S. food security? (2021, September 2). Securities. All rights reserved. Of the total 7.03 trillion held by foreign countries, Japan and Mainland China held the greatest portions. 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 . First, because U.S. securities like Treasury bills come with varying maturity dates, it would be impossible for the Chinese to call them all in at the same time. Secondly, China needs American markets to buy their exported goods. Foreign-owned land accounts for about 2.7% of all U.S. farmland and forest land, which, according to the Department of Agriculture, is about 897 million acres. Even if these bills had passed, they would have strengthened oversight on purchases of U.S. companies, not agricultural land specifically, leaving most land acquisitions unregulated. In the wake of Covid-19 supply chain disruptions and escalating tensions with China, U.S. lawmakers have specifically increased scrutiny of purchases by Chinese investors. Each bill, bond, and note represents ownership in U.S. debt. That makes Chinese exports cheaper than American-made goods, increasing sales. The FARMForeign Adversary Risk Managementact, introduced in the House of Representatives and the Senate on January 25, would trigger a Department of Agriculture and Government Accountability Office investigation into foreign influence on Americas agriculture industry. How Much U.S. Debt Does China Really Own? A few states, including top agricultural centers like Iowa and Minnesota, already have varying restrictions on foreign ownership of their farmland. I would suggest that we sit down and we work through it so we can accomplish our objective, but do it in a way that is sensitive to all those who might be somewhat offended by the approach.. Of that, 195,000 acres, worth almost $2 billion when purchased, are owned by 85 Chinese investors, which could be individuals, companies or the government. Citing the nonpartisan economic think-tank Paulson Institute, the American Security Institutereport underscores that "Chinese firms and investors own a controlling majority in nearly 2,400 U.S. CSIS does not take specific policy positions. Legal Statement. Consequences of Owing Debt to the Chinese, Government Bond: What It Is, Types, Pros and Cons, Repurchase Agreement (Repo): Definition, Examples, and Risks, U.S. Debt Ceiling: Definition, History, Pros, Cons, Clashes, Debt-to-GDP Ratio: Formula and What It Can Tell You, Major Foreign Holders of Treasury Securities, Debt Position and Activity Report, June 2017, Debt Position and Activity Report, June 2022, Your Pension Is a Lie: There's $210 Trillion of Liabilities Our Government Can't Fulfill, Frequently Asked Questions About the Public Debt, China's Gold Market: Progress and Prospects, Federal Debt Held by Federal Reserve Banks. Business Solutions including all features. "The number is very difficult to gauge correctly due to complicated ownership structures that the Chinese sometimes employ. That data also shows that the approximately 190,000 acres of farmland owned by Chinese interests has remained virtually unchanged since 2013. The manufacturing of smartphones and other household items is heavily reliant on China, which controls most of the rare earth minerals that make those items work. Please create an employee account to be able to mark statistics as favorites. What Is the Public Debt, and When Is It Too High? These foreign interests are pretty smart. The AFIDA requires foreign entities to report transactions of farmland to the USDA and imposes steep penalties for failing to report (up to 25 percent of the fair market value of the land), although they are rarely enforcedthe last fine imposed under the act was in 2014. It's politically popular to say that the Chinese "own the United States" because they are such a huge creditor. Japancommands the top spot among foreign creditors with $1.2 trillion4% of total U.S. debtowed by the U.S. government. Breaking Down the US Debt and Who Owns It. Bipartisan pressure is building to stop foreign nationals from purchasing American farm operations and receiving taxpayer subsidies. Well, really, the hallmark has been an almost otherworldly disconnection from the actual affairs of the United States. U.S. companies with Chinese shareholders more than doubled their acreage that year, accounting for 102,000 acres of the growth. You need at least a Starter Account to use this feature. 24 with 420,000 acres, which forms the site of his suborbital spaceflight company, Blue Origin. Greed Is Good or Is It? ), after gaining momentum seeded in farm states. 2 Which Country Owes the Most Money to China? Gates is No. Other foreign holders included oil-exporting countries and Caribbean banking centers. While many politicians like to angrily proclaim that China owns the United States because it owns so much of the U.S. debt, economists say that claim is far more rhetoric than fact. But you'll still see the malls and streets of the big cities filled with Christmas decorations, fir trees, Santa Claus and carols. Office of the Historian. But, exactly how much does the nation own? Of China's own top 500, 74 percent (370) were state-owned and state stock-holding enterprises, with assets of 27, 370 billion yuan and realizing profit of 266.3 billion yuan, representing 96.96 percent and 84.09 percent respectively of the top 500 corresponding values. However, there are some countriessuch as Niger, Cambodia, and Laoswhose debt to China is more than 20% of their GDP. Critical Questionsis produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. For example, in water-scarce regions like the Southwest, outside use of freshwater resources can affect water availability for local farms and communities. "How Much Money Does the World Owe China? America's farmland is owned by a variety of people and entities, including individuals, companies, and government bodies . While some states have strict laws in place, others are more open to foreign investments. David Schlessinger and I founded Five Below 16 years ago with a promise to build an amazing store for teens and pre-teens that offers trend-right, high-quality merchandise all at $5 or less, said Tom Vellios . ", Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox. Foreign ownership of U.S. agricultural land doubled from 2009 to 2019, according to U.S. Department of Agriculture (USDA) records, and policymakers have become increasingly concerned about foreign control of the U.S. food supply. By clicking Accept All Cookies, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. The answer to that question seems to be a constant source of controversy among Americas political leaders and media commentators. "The first priority is to reclaim our critical supply chains so that we can become self-secure instead of reliant on the Chinese government,"Will Coggin, managing director of the American Security Institute, told Fox News. Anyone anywhere can purchase shares of WH Group on the Hong Kong Stock Exchange. The source adds the following information: "estimates from 2010 thru 2015 include some commercial transactions. In 2019, 49 percent of reported foreign-held acreage in the United States was forest land, while 25 percent was crop land, 24 percent was for pasture and other agricultural uses, and 2 percent was for non-agricultural uses (such as homesteads and roads). Access to this and all other statistics on 80,000 topics from, Show sources information "GDP Growth (Annual %) - Japan, China.". Quotes displayed in real-time or delayed by at least 15 minutes. Foreign debt provides the opportunity for countries to secure the financing they ordinarily wouldn't have access to and to stimulate their economy. A Chinese firm has also purchased Smithfield, the world's largest pork processor and hog producer. Q3: What regulations are currently in place? Nonagricultural land (such as homesteads and roads) accounted for 2%. companies.". Register in seconds and access exclusive features. "Bretton Woods-GATT, 19411947.". In simpler terms, the government wrote itself a really big IOU and bankrupted one account to finance another activity. What Would Happen if China Were to Call In Its Debt? 2023 Center for Strategic & International Studies. 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. USDA reported in 2018 that Chinas agricultural investments in other nations had grown more than tenfold since 2009. As soon as this statistic is updated, you will immediately be notified via e-mail. Of that, 195,000 acres, worth almost $2 billion when purchased, are. All rights reserved. Still, thats less than farmland owned by people from other nations like Canada and European countries, which account for millions of acres each. The buying gorge went from April 2021 to March 2022 and . This material may not be published, broadcast, rewritten, National Debt or Federal Deficit? The House Bill is being reviewed by the Committee on Financial Services and the Committee on Agriculture. That changed with the USMCA. Demand for dollar-denominated bonds raises the dollar value compared to that of the yuan. Texas has the largest amount of foreign-held agricultural land, at 4.4 million acres, followed by Maine and Alabama, according to USDA. China's Large Position in U.S. Treasuries. [U]nder Xi Jinping, the Communist party has returned to being the ultimate authority in business," writes The Guardian. "Chinese companies have been carrying out unchecked reverse mergers for years now, and the media (influence) has been going under the radar for years now," Murad added. The United States currently produces more than enough food per capita, even after adjusting for food waste. (2022). The value will change whenever China trades Treasury securities or when the prices of those bonds change. Read our. Directly accessible data for 170 industries from 50 countries and over 1 million facts: Get quick analyses with our professional research service. Foreign investors by the end of 2019 held an interest in more than 35 million acres an area bigger than New York State. The push to drain Chinas influence from the U.S. economy has reached Americas farm country, as congressional lawmakers from both parties are looking at measures to crack down on foreign purchases of prime agricultural real estate. This dollar collapse could disrupt international markets even more than the 2008 financial crisis. "Debt Position and Activity Report, June 2017," Page 1. The debate over farm ownership comes amid broader efforts by Congress and the Biden administration to curb the nations economic reliance on China, especially in key industries like food, semiconductors and minerals deemed crucial to the supply chain. 1 Canada (12.8 million acres) and even and the Cayman Islands (672,000).
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