Chinese acquisitions and investments in the U.S. fell 92 percent to just $1.8 billion in the first five months of this year, consulting and research firm Rhodium Group said Tuesday.
The decline follows a sharp drop in the second half of last year as pressure from both Beijing and the Trump administration curbed a recent surge in cross-border investment. Completed Chinese deals in the U.S. hit a record $46 billion in 2016, and dropped to $29 billion in 2017, according to Rhodium.
In a search for investment opportunities, Chinese companies went on an overseas buying spree in 2015 and 2016.
But now, China wants to limit capital flight and excessive leverage. The U.S. is worried about intellectual property protection and has increased scrutiny of deals on the basis of national security. The Trump administration has also threatened restrictions on investment based on a "Section 301" investigation, the same study that led to the latest tariff announcements.
Big Chinese conglomerates HNA, Anbang and Wanda, are also selling many of their U.S. assets, sending the amount of completed U.S. divestitures to $9.6 billion in the first five months of this year, according to Rhodium. The analysis estimates another $4 billion in sales is pending.
Real estate and entertainment remained among the top three recipients of Chinese capital this year, driven by midsize deals and overseas-listed internet and gaming companies, Rhodium said. But thanks to seven transactions in health and biotech, the industry's share of overall Chinese deals in the U.S. rose from 9 percent last year to 58 percent so far this year, the report said.
Reference: CNBC
Thai
Eng