If China ever did call in its debt, it slowly would begin selling off its Treasury holdings. 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. "Major Foreign Holders of Treasury Securities [2000-2020]. This has been common practice for many countries ever since the Bretton Woods Conference in 1944. ", The World Bank. You can only download this statistic as a Premium user. That sounds like a lot of moneybecause it isbut it is actually a little less than the $1.24 trillion China-owned in 2011. As of the start of 2020, Chinese investors owned about 192,000 acres of U.S. agricultural land valued at about $1.9 billion, according to Politico. As economists point out, other creditors are likely to get in line to buy up Chinas share of the debt, including the Federal Reserve, already the owner of twice as much of the U.S. debt than China has ever owned. So, Lowes operates independently of Walmart. Canadian investors hold the largest share of this land, at 29 percent, with the Netherlands, Italy, Germany, and the United Kingdom collectively owning another 33 percent. Agricultural Land. "Major Foreign Holders of Treasury Securities. Investopedia contributors come from a range of backgrounds, and over 24 years there have been thousands of expert writers and editors who have contributed. This material may not be published, broadcast, rewritten, or redistributed. 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. "We Its a massive undertaking to verify who really owns [the land], Maxwell said. 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. American Companies You Didn't Know Were Owned By Chinese Investors But its the trend of increasing purchases and the buyers potential connections to the Chinese government that have lawmakers spooked. Maxwell said that poses a big risk with an older generation of farmers set to exit the industry. Nonagricultural land (such as homesteads and roads) accounted for 2%. 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. Understanding the actual extent and impact of Americas debt to China requires a closer look at these massive amounts of money. USDA reports that foreign land holdings have increased by an average of 2.2 million acres per year since 2015. Biden thanks King of Jordan for "historic meeting" in Aqaba and The government itself actually holds just under one-third, about $5 trillion, of the $19.8 trillion government debt in the form of trust funds dedicated to legislatively-mandated programs like Social Security, Medicare, and Medicaid and veterans benefits. Can you rollover Roth 401k to Roth IRA while still employed? It has opened yuan trading centers in London and Frankfurt. TreasuryDirect. 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. "Federal Debt Held by Federal Reserve Banks. 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 Agriculture Department. 1 Use Ask Statista Research Service. The other countries that hold the most U.S. debt include the U.K., with $634 billion owed; Switzerland, holding $294.1 billion in debt securities; and the Cayman Islands, slightly behind Switzerland with $293.2 billion of the United States' debt. While lawmakers remain laser-focused on Chinese buyers, other nationals own much more agricultural property in the United States. | Photo by Nathan Howard/Getty Images. Second, the Chinese rely on American markets to buy Chinese-produced goods. Chinese purchases of U.S agricultural land sparked concern in Congress among a bipartisan group of lawmakersbut 18 other countries own more American agricultural acres than China. By mid-2017, the total amount of official debt owed by the federal, state, and local governments was more than $19.8 trillion. Countries Who Own The Most Acres U.S. China is buying billions in US farmland and lawmakers are scrambling to ", The World Bank. Profit from the additional features of your individual account. Owning U.S. Treasury notes helps China's economy grow. What is the highest credit limit for Chase Sapphire? And its findings may be surprising to some. Walmart is founded and owned by the Walton family. But Meng, Newhouse and committee leaders indicated they would find a solution as the legislation winds through Congress. Market data provided by Factset. 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. 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. Newt says China will 'dominate world' if tech theft isn't stopped, 'it's a matter of life and death', share data with Chinese communist spy agencies. "The Chinese have a strong foothold here in the U.S., and Chinese firms have access to what seems like infinite government lending, and because the country's goal of world dominance is ingrained into the minds of their business leaders," explained Paul Murad, president of Nevada-based real estate firm Metroplex. A3: The only federal law governing these transactions is the Agricultural Foreign Investment Disclosure Act (AFIDA) of 1978. 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. This series of events prompted Congress to look at how to prevent Chinese ownership in U.S. agriculture, even though other foreign entities, like Brazilian-owned JBS, control similarly large portions of U.S. food supply chains. Owe China? That would hurt China's competitiveness by raising the yuans value relative to the dollar. 1 Canada (12.8 million acres) and even and the Cayman Islands (672,000). The 2011 U.S. Debt Ceiling Crisis was a contentious debate on the borrowing limit of the United States government in July 2011. Is it better to pay off credit card or pay down? Many large corporations, pension funds, and wealthy individuals are investing in agricultural land in the United States and abroad. New Data Shows U.S. Companies Are Definitely Leaving China - Forbes 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. Consider what the current arrangement means: The Chinese buy up dollar bills in the form of Treasurys. Focusing narrowly on land purchases by Chinese companies or other foreign entities will not address the full scope of this problem. It is important to note that foreign entities are not the only ones aggressively buying up U.S. farmland. Even so, large land purchases present various localized concerns in the places where they occur. Defining Alibaba Alibaba is China's and by some measures, the world's biggest online commerce company. Some experts insist on adding hundreds of trillions in unfunded future liabilities on the federal government balance sheet. Critical Questionsis produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. This amount is subject to market fluctuations. And Human Rights Watch has written that China is an'existential threat' to human rights." China owns roughly 384,000 acres of U.S. agricultural land, according to a 2021 report from the Department of Agriculture. This also reduces the purchasing power of Chinese earners. Citing staff shortages, the Department of Agriculture didnt penalize foreign parties for violating reporting rules from 2015 to 2018, prompting 28 lawmakers to criticize the departments complete lack of accountability and oversight Monday in a letter obtained by the Wall Street Journal. China has steadily accumulated U.S. Treasury securities over the last few decades. Because of varying maturities dates, China would be unable to call in all its Treasury holdings at once. Six states Hawaii, Iowa, Minnesota, Mississippi, North Dakota and Oklahoma currently ban foreign ownership of farmland. China is taking steps to make its currency, the yuan, transition to a global currency. Furthermore, policymakers have signaled no efforts to improve state- or national-level information on foreign purchases of U.S. farmland, leaving the true picture obscured. How much of the U.S. land does China own? - FinanceBand.com 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. Powered and implemented by FactSet Digital Solutions. As it is not known exactly how much US land is owned by China. In Texas, a Chinese based energy company purchased more than 130,000 acres of land near Laughlin Air Force Base and is now attempting to build a wind farm to access the U.S. power grid. Market data provided by Factset. What is the best way to liquidate stocks? The . "GDP Growth (Annual %) - China. All rights reserved. statistic alerts) please log in with your personal account. Investopedia requires writers to use primary sources to support their work. Longley, Robert. Longley, Robert. This drives China to accumulate U.S. dollars as foreign exchange (forex) reserves. ", U.S. Department of the Treasury. They hold 50% of total shares through Walton Enterprises LLC and Walton Family Holdings Trust. 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. Quotes displayed in real-time or delayed by at least 15 minutes. 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. "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. On the state level, regulations vary. Haier bought GE for $5.4 billion, a recording breaking sum at that time. The United States owes China approximately $980.8 billion as of May 2022. If it were to call in its debt, U.S. interest rates and prices could rise, slowing U.S. economic growth. Pentagon releases list of companies linked to Chinese military To do that, China had to loosen its peg to the dollar. US National Debt Clock: How Its Warning Affects You. That's a large portion of the $7.6 trillion in Treasury bills, notes, and bonds held by foreign countries. Its economy grew more than 10% for the three decades before the 2008 recession. The Netherlands is the second largest foreign owner with 4.6 million acres. How much of the U.S. land does China own? China, on the other hand, accounted for more than 80 percent of the world's supply," the report stated. "Report on Foreign Portfolio Holdings of U.S. 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. 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. I'm a reporter for Forbes' explainers and trends team. Register in seconds and access exclusive features. Federal Reserve Bank of St. Louis. Chinese billionaire and businessman Wang. Times Square billboard endeavors to warn of creeping Chinese influence. The data is entirely reliant on self-reporting, and the USDA does not check it for completeness and accuracy, so there are frequent typos, omissions, and outdated information. 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. It is responsible for lower interest rates and cheap consumer goods. The greatest share is in Texas, with over 4.4 million acres, followed by Maine (3.3 million acres) and Alabama (1.8 million acres). How Hollywood Sold Out to China - The Atlantic Other top investors are American-based companies, including Vanguard Group Inc. Apple Inc USA is an American Company that was founded in Cupertino, California. Overview and forecasts on trending topics, Industry and market insights and forecasts, Key figures and rankings about companies and products, Consumer and brand insights and preferences in various industries, Detailed information about political and social topics, All key figures about countries and regions, Market forecast and expert KPIs for 600+ segments in 150+ countries, Insights on consumer attitudes and behavior worldwide, Business information on 60m+ public and private companies, Detailed information for 35,000+ online stores and marketplaces. by Jamie Lutz The Pentagon released a list of 20 companies that it says are owned or controlled by Communist China's military and operate in the US - including tech giant Huawei, according to a report. While foreign land ownership has been reported in all 50 states and Puerto Rico, the holdings are concentrated in particular states. "Your Pension Is a Lie: There's $210 Trillion of Liabilities Our Government Can't Fulfill. 6 Modern U.S. Presidents Who Raised the Debt Ceiling, Expansionary vs. 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 owns roughly 384,000 acres of U.S. agricultural land, according to a 2021 report from the Department of Agriculture. Total number of residential properties bought by Chinese buyers in the U.S. 2010-21. As a Premium user you get access to background information and details about the release of this statistic. USDA reported in 2018 that Chinas agricultural investments in other nations had grown more than tenfold since 2009. 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. Definition and Analysis, What Is National Debt and Where It Fits Within the Economy, Alexander Hamilton and the National Economy, The History of US Government Financial Bailouts, What Was the Open Door Policy in China? That figure was$30.5trillion as of June 30, 2022. "Debt Position and Activity Report, June 2017," Page 1. We are new in this process, said Rep. Sanford Bishop (D-Ga.), chair of the agriculture appropriations subcommittee. Definition and Impact. Congressional Research Service. Does paying off all debt increase credit score? 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. According to the International Monetary Fund (IMF), the only nation with no national debt is Macao SAR. Nord Stream explosions hard to cover up - asiatimes.com 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. The hardware brand is a publicly-traded company that does not have a majority shareholder. All Rights Reserved. For these reasons, we'll likely see China remain one of the world's largest holders of U.S. national debt. [Online]. China holds more than $1 trillion of the U.S. national debt. We also reference original research from other reputable publishers where appropriate. Every year since 2010, China has held more than $1 trillion in U.S. debt. Fact Check: Does the Chinese Communist Party Own AMC - Newsweek "A recently passed law in China requires companies toshare data with Chinese communist spy agenciesif requested. Artificially suppressing the yuan has made it difficult for a growing Chinese middle class; so, exports are needed to keep businesses running. China also became the world's biggest exporter in 2009. WH Group is a publicly-traded company with shareholders around the world. "In 2017, the United States produced zero rare earth minerals. While some states have strict laws in place, others are more open to foreign investments. The House passed the agriculture appropriations bill on July 29, raising questions about how it will be enforced if it becomes law. This includes everyone from retirees who purchase individual U.S. Treasurys to the Chinese government. ", Harvard Business Review. 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. Two bills introduced in the House of Representatives and the Senate argue foreign influence on American agricultural land could affect Americas economy, food supply, and national security. You've successfully subscribed to this newsletter! The debt-to-GDP ratio measures the proportion of a country's national debt to its gross domestic product. 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. Howard Evans on Twitter: "RT @lillybug000: How much more does any The products are still made in the USA, but the decisions are made in China. Foreign debt provides the opportunity for countries to secure the financing they ordinarily wouldn't have access to and to stimulate their economy. "Bretton Woods-GATT, 19411947.". U.S. consumers benefit from low consumer prices. TUCKER CARLSON, FOX NEWS: So how would you define the Biden administration? A Chinese firm has also purchased Smithfield, the world's largest pork processor and hog producer. 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. A paid subscription is required for full access. Rep. Grace Meng (D-N.Y.) said that if the amendment was about national security, buyers from other countries should also face similar restrictions. How can I increase my credit score by 25 points? Despite holding little U.S. land, China remains focus of foreign Still, thats less than farmland owned by people from other nations like Canada and European countries, which account for millions of acres each. How Much Money Does the U.S. Foreign investors by the end of 2019 held an interest in more than 35 million acres an area bigger than New York State. 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. China needs this growth to raise its low standard of living. The USDA claims that its goal is to monitor foreign ownership of land, not to exact penalties. But, exactly how much does the nation own? Chinese firms have bought AMC Entertainment, Legendary Entertainment, and other media companies. 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. 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. 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. ThoughtCo, Sep. 2, 2021, thoughtco.com/how-much-debt-does-china-own-3321769. Securities. "China's Gold Market: Progress and Prospects," Page 2. How Much U.S. Debt Does China Really Own? The Chinese government's theft of intellectual property has been an open secret for decades. Treasury securities are freely traded around the world. 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. The Chinese Investor owns about 14% of Snapchat's shares. This intervention by the PBOC results in scarcity of U.S. dollars, which inflates their exchange rates. China "Owns" Us: How the Chinese Are Buying Up America What does China own in the U.S.? | CNBC Explains - YouTube Japancommands the top spot among foreign creditors with $1.2 trillion4% of total U.S. debtowed by the U.S. government. 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. July 18, 2022. This is partly because Japan is seen as a much friendlier nation and because Japans economy has been growing more slowly than Chinas over the last several years. The House Bill is being reviewed by the Committee on Financial Services and the Committee on Agriculture. 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. In addition, the U.S. Treasury Department has a proven track record of being able to find new creditors very quickly when needed. Discover the current debt ceiling and its economic impact. This helps inflate the value of the dollar. What's the Difference? The company was founded in Smithfield, Virginia, in 1936 and was acquired by Hong Kong-based WH Group in 2013. 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. For example, foreign investors can set up limited liability companies in the U.S. and designate an American owner to circumvent the reporting requirements while still controlling the operation behind the scenes, said Joe Maxwell, president of the progressive advocacy group Family Farm Action. Historically, between 20,000 and 40,000 residential properties were bought by. 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. How America got outmaneuvered in a critical mining race Who owns America? Hint: It's not China - CNN While foreign land ownership has been reported in all 50 states and Puerto Rico, the holdings are concentrated in particular states. Last July, a Politico report, citing Agriculture Department statistics for 2020, said Chinese companies controlled about $1.9 billion worth of agricultural land. IOUs are formed and financed through joint efforts of the U.S. Department of the Treasury and the Federal Reserve. 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. (July 18, 2022). Anyone anywhere can purchase shares of WH Group on the Hong Kong Stock Exchange. Food insecurity among U.S. families is primarily driven by poverty, not a lack of food. U.S . Fact check: Smithfield, owned by Chinese firm, sells US-processed meat 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. Mutual Fund and ETF data provided by Refinitiv Lipper. Center for Strategic and International Studies The ideal entry-level account for individual users. 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. The coronavirus pandemicmay have shed light on China'sinfluence in America over the supply chain,including life-saving medicines, technologyand equipment. These include white papers, government data, original reporting, and interviews with industry experts. 5. In May 2018, one Chinese yuan was worth about $0.16 U.S. dollar. WH Groups shareholders include many large U.S.-based financial institutions.". 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. The Chinese spy balloon shot down February 4 increased worries that foreign governments could use U.S. land for espionage efforts, reports the Journal. However, they need renminbithe official currency of the People's Republic of Chinato pay their workers and accumulate money locally. This dollar collapse could disrupt international markets even more than the 2008 financial crisis. 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. The Chinese government uses U.S. dollars it has on hand to buy Treasurys. of all foreign-owned land, cropland accounted for 29%, and pasture and other agricultural land for 22%. World Gold Council. Dollar-pegging adds stability to the yuan since the dollar is still seen as one of the safest currencies in the world. Bipartisan pressure is building to stop foreign nationals from purchasing American farm operations and receiving taxpayer subsidies.

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