It allows the U.S. Treasury to borrow more at low rates. 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. How Did the U.S. National Debt Get So Big? CNBC's Uptin Saiidi explores some of China's biggest assets in New York and explains how the tr. While the Chinese, Japanese and plenty of other foreigners own substantial amounts, it's really Americans who hold most of America's debt. Consequences of Owing Debt to the Chinese, Government Bond: What It Is, Types, Pros and Cons, Repurchase Agreement (Repo): Definition, Examples, and Risks, U.S. Debt Ceiling: Definition, History, Pros, Cons, Clashes, Debt-to-GDP Ratio: Formula and What It Can Tell You, Major Foreign Holders of Treasury Securities, Debt Position and Activity Report, June 2017, Debt Position and Activity Report, June 2022, Your Pension Is a Lie: There's $210 Trillion of Liabilities Our Government Can't Fulfill, Frequently Asked Questions About the Public Debt, China's Gold Market: Progress and Prospects, Federal Debt Held by Federal Reserve Banks. US media outlets received millions of dollars from China to sell its What does China own in the U.S.? | CNBC Explains - YouTube Office of the Historian. 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. 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. This might not sound like a lot, but Chinese ownership of American farmland has exploded dramatically over the last decade. Why Is China Buying U.S. Farmland? Security Concerns, Explained Market data provided by Factset. The ideal entry-level account for individual users. Sean Rayford/Getty Images, America cannot allow China to control our food supply, Pence said Wednesday during a speech at the conservative Heritage Foundation, urging President Joe Biden and Congress to end all farm subsidies for land owned by foreign nationals.. Foreign entities buy agricultural land for a variety of reasons, such as food production, wind farming, carbon offsets, or speculative investments. The Chinese Investor owns about 14% of Snapchat's shares. Of the $30.5 trillion in government debts, more than $6 trillion is owned by the federal government in trust funds. U.S. direct investments in China 2000-2021 | Statista 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. Show publisher information 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. As it is not known exactly how much US land is owned by China. Given the state of the AFIDA data, it seems it is doing neither. How much of America do foreigners really own? - MarketWatch In, National Association of Realtors. 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. USDA reports that foreign land holdings have increased by an average of 2.2 million acres per year since 2015. That made the yuan more attractive to forex traders in global markets. In 2019, it grew at 6.1%, an even more sustainable rate. Additionally, Walmart has never owned Dollar Tree and has no plans to acquire the business. Critical Questionsis produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. US PHARMACEUTICAL INDUSTRY AIMS TO WREST SOME DRUG PRODUCTION BACK FROM CHINA. Over 40 percent of the additional 3.4 million acres acquired by foreign investors in 2019 was located in Texas, Oklahoma, and Colorado. Since this strategy is dependent on exportsover $ 452.58 billion of which went to the U.S. in 2020China needs ever-more renminbi to continue to have a lower currency exchange rate than the U.S. dollar, and thus offer cheaper prices for the products it exports. A creditor nation has positive net investment after recording all of the financial transactions completed between it and the rest of the world. How Much U.S. Debt Does China Really Own? - ThoughtCo This statistic shows the total number of residential properties purchased by Chinese buyers in the United States from 2010 to 2021. https://www.thoughtco.com/how-much-debt-does-china-own-3321769 (accessed March 4, 2023). "Under China's Communist Party dictatorship, private companies are forced to bend to the government's will," the report states. This is just a small part of the 30 . China owns roughly 384,000 acres of U.S. agricultural land, according to a 2021 report from the Department of Agriculture. Powered and implemented by FactSet Digital Solutions. The Chinese government's theft of intellectual property has been an open secret for decades. If it were to call in its debt, U.S. interest rates and prices could rise, slowing U.S. economic growth. [Online]. Popular cinema company AMC, short for American Multi-Cinema, has been around for over a century and is headquartered in Leawood, KS. Are chinese companies state owned? Ever since the establishment of theBretton Woods Systemin 1944, the value of Chinas currency, the yuan, has been connected or pegged to the value of the U.S. dollar. Then you can access your favorite statistics via the star in the header. AMC. This includes the Federal Reserve, which already owns six times as much debt as China. As a Premium user you get access to the detailed source references and background information about this statistic. It could be bigger," he surmised. Its a massive undertaking to verify who really owns [the land], Maxwell said. All rights reserved. At some price point, U.S. consumers would buy American products instead. Michael Boyle is an experienced financial professional with more than 10 years working with financial planning, derivatives, equities, fixed income, project management, and analytics. U.S. Debt to China: How Much Is It, and Why? - The Balance More recently, U.S. authorities have discovered China is funding American university researchers, who don't always disclose those contributions. It receives these dollars from Chinese companies that receive them as payments for their exports. Tucker Carlson: America's Leadership Class Spent Years Covering Up These include white papers, government data, original reporting, and interviews with industry experts. Please create an employee account to be able to mark statistics as favorites. China held 1.1 trillion U.S. dollars in U.S. securities. The economy of China is driven by manufacturing and exporting. 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 reality is very different than the rhetoric. China does not publish the figures on its international lending. Market data provided by Factset. Debt to the Penny., U.S. Department of the Treasury. Most countries want their currency values to fall so they can win global currency wars. How much do banks charge to manage a trust? According to the Federal Reserve and U.S. Department of the Treasury, foreign countries held a total of 7.03 trillion U.S. dollars in U.S. Treasury securities as of March 2021. (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. China needs this growth to raise its low standard of living. Amanda Jackson has expertise in personal finance, investing, and social services. The offers that appear in this table are from partnerships from which Investopedia receives compensation. Foreign Purchases of U.S. Agricultural Land: Facts, Figures, and an 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. Indeed, there has been a tenfold expansion of Chinese ownership of farmland in the United States in less than a decade. 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. Walmart does not own Dollar Tree as of 2022. (ChinaOwnsUs campaign). Hilton Hotels Since 1919, Hilton has become a household name throughout the U.S. and other countries. Investopedia does not include all offers available in the marketplace. On Friday, Starwood Hotels agreed to be acquired by Anbang, a Chinese insurance company that is rapidly buying up U.S. hotels, for over $13 billion . A dollar-pegged yuan helps keep down the cost of Chinese exports, which the Chinese government believes makes it stronger in international markets. Chinas demand for Treasurys helps keep U.S. interest rates low. While lawmakers remain laser-focused on Chinese buyers, other nationals own much more agricultural property in the United States. According to the International Monetary Fund (IMF), the only nation with no national debt is Macao SAR. 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. Please do not hesitate to contact me. What country owns the most US soil? - coalitionbrewing.com Understanding the actual extent and impact of Americas debt to China requires a closer look at these massive amounts of money. Rep. Grace Meng, D-N.Y. speaks during a news conference on Capitol Hill, on May 27, 2020, in Washington. Register in seconds and access exclusive features. How America got outmaneuvered in a critical mining race Why China Buys U.S. Debt With Treasury Bonds, A Look at National Debt and Government Bonds, National Debt: Definition, Impact, Key Drivers, Current U.S. Debt, 2020 Election: The Key Economic Issues Explained. "It means our U.S. directors have a hard task on their hands when it comes to negotiation.". Legal Statement. The PBOC can print renminbi as needed. Policymakers should, instead, consider the many threats facing the future of the U.S. food system and ensure that current and aspiring farmers have the resources they need to secure long-term U.S. food production, starting with access to affordable farmland. These foreign interests are pretty smart. Foreign debt provides the opportunity for countries to secure the financing they ordinarily wouldn't have access to and to stimulate their economy. As soon as this statistic is updated, you will immediately be notified via e-mail. As a presidential candidate in 2019, Warren said she would support a national version of Iowas law along with safeguards against foreign investors using fake American buyers to circumvent the rules. This dollar collapse could disrupt international markets even more than the 2008 financial crisis. If China called in all of its U.S. holdings, the U.S. dollar would depreciate, whereas the yuan would appreciate, making Chinese goods more expensive. Robert Longley is a U.S. government and history expert with over 30 years of experience in municipal government and urban planning. What's the Difference? This material may not be published, broadcast, rewritten, or redistributed. 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. Missouri had formerly banned all foreign ownership of agricultural land in the state, but one week before Shuanghui took over Smithfield, that rule changed to allow foreign entities to own up to 1 percent of the states farmland. This material may not be published, broadcast, rewritten, What Would Happen if China Were to Call In Its Debt? 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. Nonagricultural land (such as homesteads and roads) accounted for 2%. I'm a reporter for Forbes' explainers and trends team. 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. U.S.-based companies also own over nine million acres in other countries. Washington, DC 20036. And if you measure it by gross domestic product (GDP) and consider purchasing power parity (PPP), China is seen as the worlds largest economy. Continuing a trend that began early in 2021, China's portfolio of U.S. government debt in May dropped to $980.8 billion, according to Treasury Department data released Monday. "Debt Position and Activity Report, June 2022," Page 1. This Treasury-led change makes it difficult to make long-term comparisons. 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. Disney is in no way owned by Chinese interests in terms of shareholders. This helps inflate the value of the dollar. To use individual functions (e.g., mark statistics as favourites, set CSIS does not take specific policy positions. The other 189,000 acres were worth $235 million when purchased and are owned by 62 U.S. corporations with Chinese shareholders. First, because U.S. securities like Treasury bills come with varying maturity dates, it would be impossible for the Chinese to call them all in at the same time. Secondly, China needs American markets to buy their exported goods. It's more of a novelty day like Valentine's Day, rather than a religious celebration. National Debt or Federal Deficit? China's Large Position in U.S. Treasuries. 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. In a vicious cycle, they sell the U.S. dollars they receive through exports to get renminbi, which increases the supply of U.S. dollars and raises the demand for renminbi, to the point that the renminbi ranked as the eighth most traded currency in the world as of 2019. A Chinese firm has also purchased Smithfield, the world's largest pork processor and hog producer. China's low-cost competitive strategy seems to be working. WH Group is a publicly-traded company with shareholders around the world. That data also shows that the approximately 190,000 acres of farmland owned by Chinese interests has remained virtually unchanged since 2013. You need at least a Starter Account to use this feature. Profit from the additional features of your individual account. According to the NYFC, young and aspiring farmers say access to land is their largest barrier to starting a successful farm business. Center for Strategic and International Studies You've successfully subscribed to this newsletter! Legal Statement. The United States currently produces more than enough food per capita, even after adjusting for food waste. That's when the U.S. Department of the Treasury changed how it measures the debt. Those seeking more restrictions say USDAs numbers actually understate the amount of foreign control over American ag operations. US President Joe Biden, King of Jordan II, for the "historic meeting" between Palestinians and Israelis in Aqaba. That would hurt China's competitiveness by raising the yuans value relative to the dollar. Chinese firms have expanded their presence in American agriculture over the last decade by snapping up farmland and purchasing major agribusinesses, like pork processing giant Smithfield Foods. Business Solutions including all features. 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.. China is buying billions in US farmland and lawmakers are scrambling to Q4: What federal solutions are being discussed? "Federal Debt Held by Federal Reserve Banks. This includes everyone from retirees who purchase individual U.S. Treasurys to the Chinese government. Retrieved from https://www.thoughtco.com/how-much-debt-does-china-own-3321769. Former Vice President Mike Pence speaks during an event. This amount is subject to market fluctuations. 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. However, the full extent of the Chinese investment as it stands in the U.S. today is far from transparent. The call for tighter limits on who owns Americas farms has come from a wide range of political leaders, from former Vice President Mike Pence to Sen. Elizabeth Warren (D-Mass. Every year since 2010, China has held more than $1 trillion in U.S. debt. As a major function of its monetary policy, China's central bank, the Peoples Bank of China (PBOC), actively works to prevent this imbalance between the U.S. dollar and renminbi in local markets. U.S. Debt to China: How Much Is It, and Why? In 2011, the total U.S. debt stood at $14.3 trillion. Number of U.S. properties bought by Chinese 2022 | Statista If China ever did call in its debt, it slowly would begin selling off its Treasury holdings. It's politically popular to say that the Chinese "own the United States" because they are such a huge creditor. Is it better to pay off credit card or pay down? In 2017, the United States imported $4.6 billion in agricultural goods from China, which is also responsible for much of the global supply of soy and pea proteins that are found in nutritional supplements and synthetic meats. 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 lenders snap up so much of the U.S. debt for one basic economic reason: protecting its dollar-pegged yuan. 2 This amounts to more than 13% of the U.S. debt held overseas and about 3.2% of the United States' total debt load. 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. China also became the world's biggest exporter in 2009. While foreign land ownership has been reported in all 50 states and Puerto Rico, the holdings are concentrated in particular states. 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. What is the highest credit limit for Chase Sapphire? ", The World Bank. Greed Is Good or Is It? It has held up to $1.3 trillion of U.S. debt. China has become one of the largest economies in the world. Six states forbid any foreign landholdings, and some, like Missouri, put caps on how much land can be held by foreign entities. The debt-to-GDP ratio measures the proportion of a country's national debt to its gross domestic product. (2022). Other foreign holders included oil-exporting countries and Caribbean banking centers. The amount of farmland owned by Chinese investors has remained relatively steady in recent years, according to the AFIDA data. While some states have strict laws in place, others are more open to foreign investments. to incorporate the statistic into your presentation at any time. 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. 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. Should the PBOC stop interfering, most economists agree that the renminbi would self-correct and appreciate in value, thus making Chinese exports more expensive. The Chinese yuan, like the currencies of many nations, is tied to the U.S. dollar. Indeed, there has been a tenfold expansion of Chinese ownership of farmland in the United States in less than a decade. Congress can then increase the federal spending that spurs U.S. economic growth. of all foreign-owned land, cropland accounted for 29%, and pasture and other agricultural land for 22%. China has the second-greatest amount of U.S. debt held by a foreign country.
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