Abstract
Subject Chinese investment in the United States. Significance The Foreign Investment Risk Review Modernization Act (FIRRMA) enacted on August 13 expands the remit of the Committee on Foreign Investment in the United States (CFIUS), which reviews incoming foreign investment deals for possible national security implications. China is the implicit target. Since its peak of 46 billion dollars in 2016, Chinese direct investment in the United States has steadily declined, falling to 29 billion dollars in 2017 and dropping another 90% year-on-year in the first half of 2018. Impacts Uncertainty regarding new US regulations will hold some Chinese investors back from entering the market. Chinese businesses will face greater pressure from US policymakers and regulators to clarify their relationship with the Communist Party. Chinese investments in ICT, semiconductors and other advanced technologies will come under sustained scrutiny from US regulators. Chinese greenfield investments might increase as investors seek ways around tariffs and the Trump administration seeks to create jobs.
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