Since 2018, the United States has implemented stricter investment regulations aimed at preventing foreign entities, particularly from China, from acquiring interests in sensitive sectors such as semiconductors and telecommunications. This shift follows instances of foreign investments that raised concerns among U.S. security officials.
One prominent case involved the sale of Wright USA, an insurance company that provided liability insurance to U.S. intelligence personnel. In 2015, the company was purchased by Fosun Group, a Chinese firm with reported connections to the Chinese government. Concerns arose due to Wright USA’s access to personal information of American intelligence agents, leading to an inquiry by the Committee on Foreign Investment in the U.S. (CFIUS) after a Newsweek article highlighted the potential risks. Following this scrutiny, Wright USA was sold back to American owners, although details regarding who instigated this sale remain unclear.
Research from AidData indicates that since 2000, China has invested $2.1 trillion abroad, with spending nearly evenly split between developing and wealthy nations. This financial activity suggests a strategic objective from Beijing to dominate key industries, which is encapsulated in the “Made in China 2025” initiative aimed at advanced technologies. Despite initial perceptions that investments were independent actions by Chinese firms, AidData has revealed a larger, coordinated effort by the Chinese government.
Countries such as the Netherlands have started to tighten oversight of Chinese investments, exemplified by the case of Nexperia, a Chinese-owned semiconductor company. This growing apprehension reflects a broader necessity for stronger investment screening mechanisms across multiple nations, as they confront the implications of foreign investments that may align with geopolitical ambitions.
While many Chinese companies are still navigating increased scrutiny for foreign investments, experts suggest that the dynamic nature of international relations will continue to influence investment patterns and regulatory practices.
Source: https://www.bbc.com/news/articles/c4g311jn1m9o?at_medium=RSS&at_campaign=rss