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. 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. Billions of dollars flow into the U.S. from China every year. Chart. 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. "China's Gold Market: Progress and Prospects," Page 2. In addition, the U.S. Treasury Department has a proven track record of being able to find new creditors very quickly when needed. How much of the U.S. land does China own? "Chinas Economic Rise: History, Trends, Challenges, and Implications for the United States.". 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. 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. Office of the Historian. All Rights Reserved. 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. Chinese billionaire and businessman Wang. U.S.-based companies also own over nine million acres in other countries. The other 189,000 acres were worth $235 million when purchased and are owned by 62 U.S. corporations with Chinese shareholders. 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. USDA reports that foreign land holdings have increased by an average of 2.2 million acres per year since 2015. Profit from the additional features of your individual account. 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. The money flowing into agricultural real estate from other countries also makes it difficult for new farmers in the U.S. to afford land as outside buyers bid up prices. China owns roughly 384,000 acres of U.S. agricultural land, according to a 2021 report from the Department of Agriculture. 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 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. 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). The hardware brand is a publicly-traded company that does not have a majority shareholder. The U.S. farmer population is aging, with an average age of 57.5 in 2017, up from 55 in 2012. CLICK HERE FOR COMPLETE CORONAVIRUS COVERAGE, Times Square billboard endeavors to warn of creeping Chinese influence. "Total Number of Residential Properties Purchased by Chinese Buyers in The United States from 2010 to 2022. Focusing narrowly on land purchases by Chinese companies or other foreign entities will not address the full scope of this problem. Whether you're an American retiree or a Chinese bank, American debt is considered a sound investment. A repurchase agreement is a form of short-term borrowing for dealers in government securities. This amount is subject to market fluctuations. This material may not be published, broadcast, rewritten, Quotes displayed in real-time or delayed by at least 15 minutes. China also became the world's biggest exporter in 2009. Walmart Inc. is the largest retailer in the world and one of the five largest corporations in the world by sales. Her modest, two-story white farmhouse has . "Under President Trump, the U.S. was the first to recognize their nonstop deceits, and now the rest of the world has a clearer picture of China's ambition. The House Bill is being reviewed by the Committee on Financial Services and the Committee on Agriculture. 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. Access to this and all other statistics on 80,000 topics from, Show sources information 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. 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. "In 2017, the United States produced zero rare earth minerals. While such purchases in low- and middle-income countries have been coveredextensively, they also happen here in the United States. By June 2017, the debt had grown to $19.8 trillion and was projected to top $20 trillion by January 2018. If China ever did call in its debt, it slowly would begin selling off its Treasury holdings. In fact, research firm Gartner revealed last year that a third of supply chain leaders had plans to move at least some of their manufacturing out of China before 2023. You need a Statista Account for unlimited access. The vast majority of this land is farmland, but the Chinese government and investors also own other kinds of real estate. China holds more than $1 trillion of the U.S. national debt. Haier bought GE for $5.4 billion, a recording breaking sum at that time. Does paying off all debt increase credit score? or redistributed. 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. In simpler terms, the government wrote itself a really big IOU and bankrupted one account to finance another activity. China's low-cost competitive strategy seems to be working. U.S. Department of the Treasury. Its economy grew more than 10% for the three decades before the 2008 recession. "Major Foreign Holders of Treasury Securities. If you are an admin, please authenticate by logging in again. statistic alerts) please log in with your personal account. It has opened yuan trading centers in London and Frankfurt. Other top investors are American-based companies, including Vanguard Group Inc. Apple Inc USA is an American Company that was founded in Cupertino, California. No, China does not own Walmart. Owe China? Most countries want their currency values to fall so they can win global currency wars. ", TreasuryDirect. 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 is also responding to accusations of manipulation. It has held up to $1.3 trillion of U.S. debt. Statista. "How Much U.S. Debt Does China Really Own?" ", The World Bank. As of the end of November, China owned US$1.063 trillion of the total outstanding US government debt issued by the US Department of the Treasury. Center for Strategic and International Studies 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. The top two foreign holders of U.S. debt are Japan and China. Includes buyers from the People's Republic of China, Hong Kong and Taiwan. | To do that, China had to loosen its peg to the dollar. The renewed focus on curbing foreign farm purchases comes as Biden and Agriculture Secretary Tom Vilsack roll out a series of actions to bolster the food supply chain, following major disruptions caused by the pandemic. The remaining 38 percent is held by entities from almost a hundred other countries. "GDP Growth (Annual %) - Japan, China.". What Is the Public Debt, and When Is It Too High? The Global Food Security Program would also like to thank Aliza Lauter for her research contributions to this publication. Powered and implemented by FactSet Digital Solutions. CSIS does not take specific policy positions. Every year since 2010, China has held more than $1 trillion in U.S. debt. Q1: Where and why are foreign entities purchasing farmland in the United States? Chinese buyers comprise one of the largest groups of foreign buyers of residential property in the United States. China's position as the largest foreign holder of U.S. debt gives it some political leverage. The American Security Institute recently released a report and launched a campaign, featuring a billboard in Times Square, to draw further attention to the extensive array of sectors the Chinese government and its partners have invested into. Investopedia requires writers to use primary sources to support their work. You can learn more about the standards we follow in producing accurate, unbiased content in our. | A dollar-pegged yuan helps keep down the cost of Chinese exports, which the Chinese government believes makes it stronger in international markets. That data also shows that the approximately 190,000 acres of farmland owned by Chinese interests has remained virtually unchanged since 2013. 6 Modern U.S. Presidents Who Raised the Debt Ceiling, Expansionary vs. "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. How Did the U.S. National Debt Get So Big? When the pandemic hit, Smithfield increased pork exports to China even as the United States experienced widespread meat shortages due to supply chain disruptions and Smithfield closed some of its plants due to poor working conditions. But, exactly how much does the nation own? Control of 8,000-plus of American theater screens and other media platforms allows China to project "soft power" and block unflattering depictions of the Chinese government from being presented, both in terms of creative production and mass distribution. Much of the rest of the debt is owned by individual investors, corporations, and other public entities. CNBC's Uptin Saiidi explores some of China's biggest assets in New York and explains how the tr. Countries Who Own The Most Acres U.S. 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. You've successfully subscribed to this newsletter! I'm a reporter for Forbes' explainers and trends team. 2 Which Country Owes the Most Money to 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. So, in part, Chinese demand for American property is a sign of their desire to give their children the best opportunities to have a successful future.. ", International Monetary Fund. At some price point, U.S. consumers would buy American products instead. 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. Read our. 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. 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. 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. Financing for these huge annual IOUs comes from the Department of the Treasury and the Federal Reserve. However, the US government estimates that Chinese-owned entities own approximately 7,000 acres of land in the US, which is a small fraction of the 2. . 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. This material may not be published, broadcast, rewritten, or redistributed. So, Lowes operates independently of Walmart. As soon as this statistic is updated, you will immediately be notified via e-mail. Cena's apology made him a darling to Chinese nationalists and a punching bag for U.S. media. For example, Chinese pharmaceutical companies supply 70 percent of the world's acetaminophen, commonly used in Tylenol. Critical Questionsis produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. 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. How many times does Coca Cola pay dividends? Definition and Impact. You only have access to basic statistics. From 2016, the estimates include only residential transactions. TUCKER CARLSON, FOX NEWS: So how would you define the Biden administration? Federal Reserve Bank of St. Louis. Pallets of sod cover part of the 230 acre Kuenzi Turf & Nursery on June 2, 2021 in Salem, Oregon. 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. Then ownership jumped 30% from 2019 to 2020, from some 247,000 acres to roughly 352,000. 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. Robert Longley is a U.S. government and history expert with over 30 years of experience in municipal government and urban planning. China is the second-largest holder of the debt, even after it reduced its holdings, which it has been doing since 2011. "Frequently Asked Questions About the Public Debt. A creditor nation has positive net investment after recording all of the financial transactions completed between it and the rest of the world. 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. 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 . Disney is in no way owned by Chinese interests in terms of shareholders. Texas has the largest amount of foreign-held agricultural land, at 4.4 million acres, followed by Maine and Alabama, according to USDA. I would suggest that we sit down and we work through it so we can accomplish our objective, but do it in a way that is sensitive to all those who might be somewhat offended by the approach.. The PBOC can print renminbi as needed. The economy of China is driven by manufacturing and exporting. Its three main sites Taobao, Tmall and Alibaba.com have hundreds of millions of users, and host millions of merchants and businesses. But its the trend of increasing purchases and the buyers potential connections to the Chinese government that have lawmakers spooked. Amazon founder Jeff Bezos comes in at No. In August 2022, the Asian nation owned $971.8 billion in Treasurys, roughly 13% of the U.S. national debt. Now China owns the airspace and Australian citizens can't land in their own country without approval from the Chinese government. This includes the Federal Reserve, which already owns six times as much debt as China. These foreign interests are pretty smart. Canada is the biggest foreign owner of U.S. agricultural and timber land, and owns 4.7 million acres in the United States. While lawmakers remain laser-focused on Chinese buyers, other nationals own much more agricultural property in the United States. Is it better to pay off credit card or pay down? The National Young Farmers Coalition (NYFC) anticipates that two-thirds of farmland will change hands over the next decade as farmers retire, meaning that more land could become available for foreign purchase. But Meng, Newhouse and committee leaders indicated they would find a solution as the legislation winds through Congress. Walmart does not own Dollar Tree as of 2022. The United States currently produces more than enough food per capita, even after adjusting for food waste. The Senate Bill is being reviewed by the Committee on Banking, Housing and Urban Affairs. They use different business structures to further conceal it.. That sounds like a lot of moneybecause it isbut it is actually a little less than the $1.24 trillion China-owned in 2011. ThoughtCo, Sep. 2, 2021, thoughtco.com/how-much-debt-does-china-own-3321769. According to the U.S. Census Bureau, the U.S. has been suffering from a significant trade deficit with China since 1985, meaning that the U.S. buys more goods and services from China than China buys from the U.S. Chinese exporters receive U.S. dollars for their goods sold to the U.S. Consider what the current arrangement means: The Chinese buy up dollar bills in the form of Treasurys. Stephen Gandel. 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. Breaking Down the US Debt and Who Owns It. She is a library professional, transcriptionist, editor, and fact-checker. Milos Maricic, an international affairs expert and World Economic Forum contributor, concurred that while China owns close to $150 billion in U.S. companies not particularly huge in comparison to the U.S. economy there is a lot about the available figure that we simply do not know. July 18, 2022. US PHARMACEUTICAL INDUSTRY AIMS TO WREST SOME DRUG PRODUCTION BACK FROM CHINA. Nations borrowing from each other may be as old as the concept of money. According to the NYFC, young and aspiring farmers say access to land is their largest barrier to starting a successful farm business. Additionally, Walmart has never owned Dollar Tree and has no plans to acquire the business. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s). Scrutiny of foreign-owned agricultural operations receiving taxpayer subsidies has also been rising in recent years after meatpacking conglomerates like the U.S. subsidiary of Brazilian-owned JBS received millions of dollars under the Trump administrations trade bailout starting in 2018. At the same time, American consumers are assured of a steady flow of relatively inexpensive Chinese products and services. Instead, Dollar Tree is a self-owned company that itself has acquired numerous national and regional competitors over the years, including Family Dollar and Dollar Bill$. ThoughtCo. The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. And its findings may be surprising to some. A Chinese firm has also purchased Smithfield, the world's largest pork processor and hog producer. "GDP growth (Annual %) - 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. From May 2021 to May 2022, the debt to Japan and China decreased by 4% and 9%, respectively. "Report on Foreign Portfolio Holdings of U.S. 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. (2021, September 2). "Bretton Woods-GATT, 19411947.". 2023 FOX News Network, LLC. Of the total 7.03 trillion held by foreign countries, Japan and Mainland China held the greatest portions. 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. Its a massive undertaking to verify who really owns [the land], Maxwell said. 41 on The Land Reports 2022 list of Americans who own the most land. Register in seconds and access exclusive features. 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. Over 40 percent of the additional 3.4 million acres acquired by foreign investors in 2019 was located in Texas, Oklahoma, and Colorado. 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.. This has been common practice for many countries ever since the Bretton Woods Conference in 1944. 18, far behind No. And if you measure it by gross domestic product (GDP) and consider purchasing power parity (PPP), China is seen as the worlds largest economy. Of the 109 countries that own U.S. agricultural land, China ranks No. Popular cinema company AMC, short for American Multi-Cinema, has been around for over a century and is headquartered in Leawood, KS. The USDA could enforce the portion of the bill that bans Chinese-owned companies from participating in federal benefits programs, but constitutionally, land purchasing falls under states rights, and legislators have made no motions to change that. of all foreign-owned land, cropland accounted for 29%, and pasture and other agricultural land for 22%. 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. Artificially suppressing the yuan has made it difficult for a growing Chinese middle class; so, exports are needed to keep businesses running. 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. Its allowed the yuan to trade in a wider trading range around a basket of currencies that include the dollar. 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. Bipartisan pressure is building to stop foreign nationals from purchasing American farm operations and receiving taxpayer subsidies. That's a large portion of the $7.6 trillion in Treasury bills, notes, and bonds held by foreign countries. Coronavirus-related sales slumps and supply chain disruption, as well as rising production costs, have also hastened the exodus. Smithfield is vertically integrated and owns all aspects of its supply chain, meaning that WH Group now controls a significant portion of U.S. pork production and revenue in addition to farmland. For its part, China owned 191,000 acres worth $1.9 billion as of 2019. 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. If it were to call in its debt, U.S. interest rates and prices could rise, slowing U.S. economic growth. "China's Currency Policy," Page 1. The value will change whenever China trades Treasury securities or when the prices of those bonds change. "Major Foreign Holders of Treasury Securities.". National Association of Realtors. Crops beings harvested on an Iowa farm in 2018, Weak Oversight of Foreign Farmland Deals Sparks Concern Amid China Purchases, North Dakota Turns Against Chinese Corn Mill Project. National Association of Realtors. Securities. We also reference original research from other reputable publishers where appropriate. Demand for dollar-denominated bonds raises the dollar value compared to that of the yuan. The House passed the agriculture appropriations bill on July 29, raising questions about how it will be enforced if it becomes law. As a result, the public does not have a complete picture of which foreign entities own how much U.S. farmland or what the land is being used for. Q5: What is the real threat to U.S. food security? All rights reserved. ", United States Department of Treasury. 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). That would hurt China's competitiveness by raising the yuans value relative to the dollar. You need at least a Starter Account to use this feature. A3: The only federal law governing these transactions is the Agricultural Foreign Investment Disclosure Act (AFIDA) of 1978. Congressional Research Service. 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. Longley, Robert. 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. Even at a slow pace, dollar demand would drop. 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. More recently, U.S. authorities have discovered China is funding American university researchers, who don't always disclose those contributions. That data also shows that the. Accessed March 04, 2023. https://www.statista.com/statistics/611020/total-number-of-properties-purchased-by-chinese-buyers-in-the-us/. 1 Canada (12.8 million acres) and even and the Cayman Islands (672,000). the metropolitan, edgewater,

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