A repurchase agreement is a form of short-term borrowing for dealers in government securities. These are especially vital not only for high-technology products such as smartphones and electric vehicles but for U.S. frontline weapons including the F-35 fighter, which requires 920 pounds of rare earth minerals. It allows the U.S. Treasury to borrow more at low rates. That effort includes greater scrutiny of large meat processing companies like JBS and Smithfield, as well as plans to tighten the requirements for meat to be labeled a Product of the USA.. The post, which has been shared over 256,000 times as of April 14, is headlined with "read this before buying meat." "The hogs will still be raised here, but slaughtered and packaged for . The vast majority of this land is farmland, but the Chinese government and investors also own other kinds of real estate. A Chinese firm has also purchased Smithfield, the world's largest pork processor and hog producer. Some experts insist on adding hundreds of trillions in unfunded future liabilities on the federal government balance sheet. The source adds the following information: "estimates from 2010 thru 2015 include some commercial transactions. While foreign land ownership has been reported in all 50 states and Puerto Rico, the holdings are concentrated in particular states. China drew some headlines in 2013 and 2014 for buying up a lot of gold to store in its bank vaults, but the real safety net for the yuan is the worldwide belief in the dollar. 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. China produces 97 percent of U.S. antibiotics and about 80 percent of active pharmaceutical ingredients used in American drugs, giving the Chinese Communist Party absolute controlof potentially life-saving medicine. That would hurt China's competitiveness by raising the yuans value relative to the dollar. The debt-to-GDP ratio measures the proportion of a country's national debt to its gross domestic product. With the U.S. dollar considered one of the safest and most stable currencies in the world, dollar-pegging helps the Chinese government maintain the stability and value of the yuan. "Bretton Woods-GATT, 19411947.". ThoughtCo, Sep. 2, 2021, thoughtco.com/how-much-debt-does-china-own-3321769. China also became the world's biggest exporter in 2009. Gates continues to deny any plot, telling Reddit users in January that he owns less than one four-thousandths of U.S. farmland and invests in farms to improve their production and create jobs. Chinese buyers comprise one of the largest groups of foreign buyers of residential property in the United States. 1616 Rhode Island Avenue, NW 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. July 18, 2022. (July 18, 2022). And Human Rights Watch has written that China is an'existential threat' to human rights." The average American is made better off by foreigners providing inexpensive services and only demanding pieces of paper in return. This compensation may impact how and where listings appear. Milos Maricic, an international affairs expert and World Economic Forum contributor, concurred that while China owns close to $150 billion in U.S. companies not particularly huge in comparison to the U.S. economy there is a lot about the available figure that we simply do not know. 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. Interest on the National Debt and How It Affects You, US Debt by President: By Dollar and Percentage, US Budget Deficit by Year Compared to GDP, the National Debt, and Events, Chinas Economic Slowdown and How It Affects You, China's Economy and Its Effect on the U.S. Economy, China's Currency, the Yuan, and How It Affects You, How the Yuan Could Become a Global Currency, Debt Ceiling Dictionary: Your Guide to the Jargon, Major Foreign Holders of Treasury Securities, Report on Foreign Portfolio Holdings of U.S. Securities, Major Foreign Holders of Treasury Securities [2000-2020], Chinas Economic Rise: History, Trends, Challenges, and Implications for the United States. Times Square billboard endeavors to warn of creeping Chinese influence. 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. While their market shares may be different percentages (Amazon owns 39% of all US ecommerce sales, while Alibaba owns 58.2% of all retail ecommerce shares in China), they each dominate their respective countries in which they began. At the same time, American consumers are assured of a steady flow of relatively inexpensive Chinese products and services. Haier bought GE for $5.4 billion, a recording breaking sum at that time. AMC. We are new in this process, said Rep. Sanford Bishop (D-Ga.), chair of the agriculture appropriations subcommittee. But the contrition paid off: F9 grossed $136 million in China its first weekend, nearly double its . In late May, the Senate unanimously passed the bipartisan Holding Foreign Companies Accountable Act in a bid to force foreign companies with China at the likely forefront to adhere to U.S. securities law, and compel some to be removed from American stock exchanges. China needs this growth to raise its low standard of living. All rights reserved. While such purchases in low- and middle-income countries have been coveredextensively, they also happen here in the United States. U.S.-based companies also own over nine million acres in other countries. National Debt or Federal Deficit? Advocacy groups like the National Family Farm Coalition argue that the larger threat to national security is corporate capture of U.S. land resources, whether those corporations are U.S.- or foreign-owned. 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 . Investopedia contributors come from a range of backgrounds, and over 24 years there have been thousands of expert writers and editors who have contributed. ", Harvard Business Review. But, exactly how much does the nation own? It has opened yuan trading centers in London and Frankfurt. (ChinaOwnsUs campaign). It was revealed that just last year alone, China spent $6.1 billion dollars on housing in the U.S. making it America's top foreign buyer. However, there are some countriessuch as Niger, Cambodia, and Laoswhose debt to China is more than 20% of their GDP. "It means our U.S. directors have a hard task on their hands when it comes to negotiation.". Dollar-pegging adds stability to the yuan since the dollar is still seen as one of the safest currencies in the world. These include white papers, government data, original reporting, and interviews with industry experts. By June 2017, the debt had grown to $19.8 trillion and was projected to top $20 trillion by January 2018. Should the PBOC stop interfering, most economists agree that the renminbi would self-correct and appreciate in value, thus making Chinese exports more expensive. Its a massive undertaking to verify who really owns [the land], Maxwell said. Whether you're an American retiree or a Chinese bank, American debt is considered a sound investment. Arizona, for instance, has no rules on groundwater pumping as long as it is for a beneficial use, which includes agriculture even if the products are shipped elsewhere. Countries Who Own The Most Acres U.S. The . A creditor nation has positive net investment after recording all of the financial transactions completed between it and the rest of the world. Powered and implemented by FactSet Digital Solutions. Former Vice President Mike Pence speaks during an event. Currently, you are using a shared account. Most countries want their currency values to fall so they can win global currency wars. You can learn more about the standards we follow in producing accurate, unbiased content in our. There are two main economic reasons Chinese lenders bought up so many U.S. Treasury securities. This statistic is not included in your account. Center for Strategic and International Studies According to sources, Time Magazine received $700,000, the Financial Times $371,577, Foreign Policy Magazine $291,000, the Los Angeles Times $272,000, and other notable media outlets received more than $1 million. Still, thats less than farmland owned by people from other nations like Canada and European countries, which account for millions of acres each. What's the Difference? These foreign interests are pretty smart. TreasuryDirect. Chinese agricultural land ownership only increased about 550 acres from 2015 to 2019. What Is the Public Debt, and When Is It Too High? The other 189,000 acres were worth $235 million when purchased and are owned by 62 U.S. corporations with Chinese shareholders. ", U.S. Department of the Treasury. 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. If China ever did call in its debt, it slowly would begin selling off its Treasury holdings. The hardware brand is a publicly-traded company that does not have a majority shareholder. The government now provides affordable housing by subsidizing commercial housing purchases or by offering low-rent public (social) housing to middle- and low-income families. Now China owns the airspace and Australian citizens can't land in their own country without approval from the Chinese government. From 2016, the estimates include only residential transactions. The first and most important is that China wants its currency, the yuan, pegged to the dollar. The largest holder of U.S. debt is the United States government. It would perpetuate already rising anti-Asian hate, Meng warned at the markup. The data is based on a 1978 law directing foreign nationals to report their U.S. agricultural holdings to USDA a requirement that can be difficult for the department to enforce. China's low-cost competitive strategy seems to be working. China acquired another 32,000 U.S. agricultural acres in 2021not as much as they scooped up in 2020, but 98% higher than their combined growth between 2015 and 2019. Chinese billionaire and businessman Wang. 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. 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. 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. 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. This also reduces the purchasing power of Chinese earners. 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. With most forms of U.S. debt, like Treasury bills, redeemable in U.S. dollars, worldwide trust in the dollar and the U.S. economy, in general, remains Chinas main safeguard for the yuan. You can find out more about our use, change your default settings, and withdraw your consent at any time with effect for the future by visiting Cookies Settings, which can also be found in the footer of the site. The current trend in the U.S. is leading us toward the creation of a Chinese-owned agricultural land monopoly, Rep. Dan Newhouse (R-Wash.) warned during a recent House Appropriations hearing. "General Government Gross Debt.". Many Americans find the brand appealing because it has a "Made in America" stamp on its products, however, the company has been owned by Chinese company Haier since 2016. ", TreasuryDirect. Critics claim that the rule change was instrumental in allowing the deal to go through as written, and some members of Congress warned of Chinese government involvement in the purchase. World Gold Council. While Japans 4.8% ownership of the U.S. debt is only slightly less than Chinas 5.3%, the Japanese-owned debt is rarely depicted in a negative light, as is Chinas. Smithfield was also in line to receive money from the program, which was created to help U.S. farmers strung by trade retaliation from China and other competitors. 24 with 420,000 acres, which forms the site of his suborbital spaceflight company, Blue Origin. It amounted to about 192,000 of the. In 2021, Chinese buyers bought 6,300 U.S. properties worth 4.5 billion U.S. dollars. "Your Pension Is a Lie: There's $210 Trillion of Liabilities Our Government Can't Fulfill. Six states forbid any foreign landholdings, and some, like Missouri, put caps on how much land can be held by foreign entities. USDA reports that foreign land holdings have increased by an average of 2.2 million acres per year since 2015. For its part, China owned 191,000 acres worth $1.9 billion as of 2019. While a large portion of Smithfield pork was already being exported to China prior to the acquisition, the Covid-19 crisis raised concerns about Chinese control of U.S. food supply chains. That data also shows that the approximately 190,000 acres of farmland owned by Chinese interests has remained virtually unchanged since 2013. Its three main sites Taobao, Tmall and Alibaba.com have hundreds of millions of users, and host millions of merchants and businesses. Dalian Wanda purchased a majority stake in AMC for $2.6 billion, making AMC the largest theater operator at the time, according to a report from Reuters. "GDP growth (Annual %) - China. Q1: Where and why are foreign entities purchasing farmland in the United States? "Chinas Economic Rise: History, Trends, Challenges, and Implications for the United States.". Popular cinema company AMC, short for American Multi-Cinema, has been around for over a century and is headquartered in Leawood, KS. ThoughtCo. "Total number of residential properties purchased by Chinese buyers in the United States from 2010 to 2022." Business Solutions including all features. Foreign entities buy agricultural land for a variety of reasons, such as food production, wind farming, carbon offsets, or speculative investments. Conspiracy theorists suggested Gates was buying up millions of acres of U.S. farmland for nefarious reasons, according to the fact-checking service Snopes, with some claiming that Gates owned 80% of all U.S. farmland. Other top investors are American-based companies, including Vanguard Group Inc. Apple Inc USA is an American Company that was founded in Cupertino, California. ), after gaining momentum seeded in farm states. When this land changes hands, theyre going to gobble it up, he said of foreign buyers. At some price point, U.S. consumers would buy American products instead. of all foreign-owned land, cropland accounted for 29%, and pasture and other agricultural land for 22%. RT @lillybug000: How much more does any American have to see to realize our government is owned by China. Land grabbingwhen a government, company, or other entity purchases large swathes of land in another countrycan affect local land rights and agricultural production, sometimes putting local food security at risk. Stoves, refrigerators, washers and dryers from General Electric have been around for more than 100 years, but starting last year, the appliance division of the iconic company has been Chinese. Second, the Chinese rely on American markets to buy Chinese-produced goods. Office of the Historian. But you'll still see the malls and streets of the big cities filled with Christmas decorations, fir trees, Santa Claus and carols. For example, the huge amount of debt that the U.S. government owes Chinese lenders has been the subject of countless debates, headline news stories, and political platforms for decades. Market data provided by Factset. Across the country, the 2013 purchase of Smithfield Foods by the Chinese firm Shuanghui, now called WH Group, received national attention and escalated concerns about Chinese intervention in U.S. food systems. This amount is subject to market fluctuations. Quotes displayed in real-time or delayed by at least 15 minutes. The PBOC can print renminbi as needed. Nations borrowing from each other may be as old as the concept of money. Robert Longley is a U.S. government and history expert with over 30 years of experience in municipal government and urban planning. According to the International Monetary Fund (IMF), the only nation with no national debt is Macao SAR. China Daily, which is controlled by the Chinese Communist Party, has paid more than $4.6 million to The Washington Post and . 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). The rest of the $29 trillion national debt is owned by either people in the U.S. or by the U.S. government itself. Greed Is Good or Is It? Longley, Robert. This includes the Federal Reserve, which already owns six times as much debt as China. China also is liberalizing its control of the yuan, also called the "renminbi." Federal Reserve Bank of St. Louis. In return, American consumers get cheap Chinese products and incoming investment capital. And while the U.S. grants China permission to buy its companies, China does not allow U.S. companies to operate the same way on their soil. Manuel Balce Ceneta/AP Photo. Since 2016, a company owned by Xinjiang-based real estate tycoon Sun Guangxin had spent an estimated $110 million buying up land in Texas' Val Verde County. 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. 2023 FOX News Network, LLC. Six states Hawaii, Iowa, Minnesota, Mississippi, North Dakota and Oklahoma currently ban foreign ownership of farmland. The deal meant that WH Group now owns the largest pork producer in the United States as well as over 146,000 acres of Missouri farmland. or redistributed. Are you interested in testing our business solutions? Investopedia does not include all offers available in the marketplace. Anyone anywhere can purchase shares of WH Group on the Hong Kong Stock Exchange. 4356 (117)) that would block any new agricultural purchases by companies that are wholly or partly controlled by the Chinese government and bar Chinese-owned farms from tapping federal support programs. All rights reserved. Billions of dollars flow into the U.S. from China every year. And its findings may be surprising to some. The reality is very different than the rhetoric. The Communist Party has actively supported investments in foreign agriculture as part of its One Belt One Road economic development plans, aiming to control a greater piece of Chinas food supply chain. Douglas R. Bush, Deterring a Cross-Strait Conflict: Beijing's Assessment of Evolving U.S. Strategy, Rethinking Humanitarian Aid: A Conversation with Michelle Nunn, President and CEO of CARE USA, Foreign Purchases of U.S. 5. The remaining 38 percent is held by entities from almost a hundred other countries. However, the full extent of the Chinese investment as it stands in the U.S. today is far from transparent. But its the trend of increasing purchases and the buyers potential connections to the Chinese government that have lawmakers spooked. The measure is expected to reach the House floor before the end of July, as part of a broader appropriations package, although the Senate has not yet drafted its own version of the spending bill. Japanese-owned debt doesn't receive nearly as much negative attention as Chinese-owned debt, ostensibly because Japan is seen as a friendlier nation and the Japanese economy hasn't grown as fast as China's year after year. "Major Foreign Holders of Treasury Securities. 1 It is not only foreign companies who take advantage of this regulatory loophole, howevercompanies from other states and cities around the United States are also buying up land in Arizona to take advantage of the states loose water regulations, putting Arizonas long-term water resources at risk. The rest of the $29 trillion national debt is owned by either people in the U.S. or by the U.S. government itself. 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 . Historically, between 20,000 and 40,000 residential properties were bought by. 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. 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. China could start this process only after it further expanded its exports to other Asian countries and increased domestic demand. As a Premium user you get access to background information and details about the release of this statistic. From May 2021 to May 2022, the debt to Japan and China decreased by 4% and 9%, respectively. It's politically popular to say that the Chinese "own the United States" because they are such a huge creditor. and Caitlin Welsh. No, China does not own Walmart. Before June 2010, Treasury reports showed that China held about $843 billion in debt. Artificially suppressing the yuan has made it difficult for a growing Chinese middle class; so, exports are needed to keep businesses running. China holds more than $1 trillion of the U.S. national debt. China's state-directed industrial policy has outmaneuvered America's laissez-faire approach to securing access around the world to a metal that's taking on growing economic and strategic . United States Treasury Fiscal Data. This has been common practice for many countries ever since the Bretton Woods Conference in 1944. Agricultural Land: Facts, Figures, and an Assessment of Real Threats, Brzezinski Chair in Global Security and Geostrategy, Diversity and Leadership in International Affairs Project, Energy Security and Climate Change Program, Media Relations Manager, External Relations. 2 Which Country Owes the Most Money to China? Amazon founder Jeff Bezos comes in at No. Foreign debt provides the opportunity for countries to secure the financing they ordinarily wouldn't have access to and to stimulate their economy. 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. China's economic growth has slowed over the years. "In 2017, the United States produced zero rare earth minerals. Walmart Inc. is the largest retailer in the world and one of the five largest corporations in the world by sales. "How Much Money Does the World Owe China? 2021 by the Center for Strategic and International Studies. Japan consistently tops the list, owning about $1.3 trillion as of October 2021. That's when the U.S. Department of the Treasury changed how it measures the debt. Many large corporations, pension funds, and wealthy individuals are investing in agricultural land in the United States and abroad. China produces 97 percent of U.S. antibiotics and about 80 percent of active pharmaceutical ingredients used in American drugs, giving the Chinese Communist Party absolute control of. What Would Happen if China Were to Call In Its Debt? It is important to note that foreign entities are not the only ones aggressively buying up U.S. farmland. That figure was$30.5trillion as of June 30, 2022. 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. The best of the best: the portal for top lists & rankings: Strategy and business building for the data-driven economy: Industry-specific and extensively researched technical data (partially from exclusive partnerships). While some states have strict laws in place, others are more open to foreign investments. Cookies collect information about your preferences and your devices and are used to make the site work as you expect it to, to understand how you interact with the site, and to show advertisements that are targeted to your interests. Rep. Grace Meng, D-N.Y. speaks during a news conference on Capitol Hill, on May 27, 2020, in Washington. Chart. "Total Number of Residential Properties Purchased by Chinese Buyers in The United States from 2010 to 2022. Walmart owns no shares. Consider what the current arrangement means: The Chinese buy up dollar bills in the form of Treasurys. White House National Security Advisor Jake Sullivan said in a statement that the United States welcomes the commitments of Israel and the Palestinian Authority to reduce tensions and prevent further violence. The Department of Agriculture requires foreign entities who buy U.S. agricultural land to file a report within 90 days disclosing what they bought. As a Premium user you get access to the detailed source references and background information about this statistic. The real question is: How much of the totalU.S. debtdoes the U.S.federal governmentowe to Chinese lenders? ", Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox. 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. However, the items are Manufactured and Assembled in China, with Foxconn, a Taiwanese-based firm, producing the majority of Apple's products. How Much Money Does the U.S. By artificially keeping the value of the yuan down, the government reduces the buying power of the Chinese middle class, thus making the sale of exports vital keeping the countrys economy moving. The economy of China is driven by manufacturing and exporting. Q3: What regulations are currently in place? Angela Huffman is a sixth-generation farmer in Wyandot County, which, along with Paulding County, has more than 41,000 acres of foreign-owned farmland. However, they need renminbithe official currency of the People's Republic of Chinato pay their workers and accumulate money locally. ", The World Bank. ", International Monetary Fund. Some U.S. lawmakers are pushing back amid the coronavirus fallout, which ignited an initial panic over concerns of critical medical shortages and Beijing's threats to withhold the needed goods. Investopedia requires writers to use primary sources to support their work. Owe China? (Smithfield said in a later statement pertaining to their ownership structure that they are "a U.S. company that provides more than 40,000 American jobs and partners with thousands of American farmers. A4: Since the 2013 purchase of Smithfield Foods, multiple bills have been proposed to provide more oversight of foreign investments in U.S. agricultural companies (including in 2017 and 2020), but until recently they each died in committee. A1: USDA records provide the best source of information on foreign-held agricultural land, although they are still incomplete and contain many errors (as explained in A3 below). Does paying off all debt increase credit score? America's farmland is owned by a variety of people and entities, including individuals, companies, and government bodies . China and investors tied to the CCP own just shy of 200,000 acres of various types of land in the United States. Each bill, bond, and note represents ownership in U.S. debt. Although Congress has become increasingly concerned about Chinese land purchases, investors from China currently own only a small fraction of this land, at 191,652 acres (0.05 percent of the total). Of the 109 countries that own U.S. agricultural land, China ranks No. The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Countries with lower currency values export more, since their products cost less when sold in foreign countries. "He firmly believes that China, before the year [20]30, '35, is going to own America because autocracies can make quick decisions." The president did not elaborate on what was meant by "own.