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Cho Tak Wong, the president of auto glass giant Fuyao Glass, bought the vacant General Motors plant in Moraine, Ohio in 2014.
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Chinese investments in the United States have fallen sharply since the first term of Donald Trump. That trend is unlikely to reverse when Trump returns to the White House, analysts said.
Trump has threatened additional tariffs on Chinese goods immediately after his inauguration on Monday, building on an increasingly tough US stance on Beijing.
“That’s probably the last thing on Trump’s mind, is trying to incentivize him [Chinese companies] to invest there,” said Rafiq Dossani, an economist at the US-based RAND think tank.
“There is an ideological discrepancy. The whole rhetoric is, keep China out of the United States, let their products in, which are low-end,” he said in an interview earlier this month. But other than that, “don’t do it, don’t let it in.”
In recent weeks, the property giant Emirates Damac pledged $20 billion to build data centers in the United States, while SoftBank CEO Masayoshi Son announced a investment of $100 billion for the development of artificial intelligence in the United States over the four-year term of Trump.
Chinese investment business in the United States has slowed down dramatically, according to the latest Data from the American Enterprise Institute. Only $860 million came to the United States in the first six months of 2024, after $1.66 billion in 2023. It is down from $46.86 billion in 2017, when Trump began his first term.
At the peak, Chinese companies had made high-profile American acquisitions, such as the acquisition of Hotel Waldorf Astoria in New York. But regulators on both sides have blocked the flow.
“Chinese investment in the United States has slowed sharply since Beijing tightened controls on capital flows in 2017, followed by a series of regulatory policies in the United States aimed at excluding investments in certain sectorsDanielle Goh, senior research analyst at Rhodium Group, said in an email.
In the “foreseeable future”, he did not expect Chinese investments in the United States to recover to the peak levels seen during the period 2016 to 2017. Goh noted that instead of acquisitions, Chinese companies returned more to small joint ventures with American companies or greenfield investments, in which the business is built from scratch.
For example, the Chinese battery manufacturing company EVE Energy is the technology partner with a 10% stake in the joint venture with the Accelera division of Cummins, Daimler Truck and PACCAR. The companies announced in June 2024 that they launched plans for a battery factory in Mississippi that will begin production in 2027 and create more than 2,000 jobs.
Since the Covid-19 pandemic, the US-China Chamber of Commerce has mostly helped Chinese e-commerce companies set up local offices, instead of setting up manufacturing companies, association president Siva Yam told CNBC.
“Most of those investments today tend to be a little bit smaller, so they’re not on the radar, easier to approve,” he said, referring to regulators in both the United States and China. But it was uncertain whether Chinese companies would be able to use investments to offset the impact of the tariffs.
Individual US states have become increasingly wary of Chinese investment. Last spring, Politico said that more than 20 states they would pass new restrictions on the purchase of land by Chinese citizens and companies, or update existing rules.
Chinese hackers in December targeted a government office that analyzes foreign investments in the United States, CNN saidciting US officials. This was part of a broader breach of the Treasury Department, which declined a request for comment from CNBC.
Strategy for making a deal?
Trump has indicated that the tariffs may be used to coerce Chinese investment in the United States
In his speech accepting the Republican nomination, he said: “I will bring auto jobs back to our country, through the proper use of taxes, fees and incentives, and will not allow the construction of massive plants of car manufacturing in Mexico, China or other countries.
“The way they will sell their product in America is to BUILT in Americaand ONLY in America. This will create massive jobs and wealth for our country,” he said, according to an NBC News transcript.
Chinese battery giant CATL said in November build a US plant if Trump allows it. The company did not immediately respond to a request for comment.
The advocacy group Center for American Progress said in December that during his first term, Trump reversed the restrictions on Chinese telecommunications company ZTE — just days after the Chinese government and Chinese banks invested $1 billion in a Trump Organization-affiliated theme park in Indonesia.
Trump’s transition team did not immediately respond to a request for comment on the ZTE deal or opportunities for Chinese companies to invest in the United States.
Even if Trump welcomed more Chinese investment, or forced it through tariffs, big investments are long-term processes that won’t happen overnight, said Derek Scissors, senior fellow at the American Enterprise Institute. .
Then there is the unpredictability of the president-elect’s policies.
“Trump saying that the United States is open to Chinese companies in 2025 is not a guarantee [even] for 2029,” he said.
