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 number is very difficult to gauge correctly due to complicated ownership structures that the Chinese sometimes employ. 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. I'm a reporter for Forbes' explainers and trends team. Foreign entities buy agricultural land for a variety of reasons, such as food production, wind farming, carbon offsets, or speculative investments. China Daily, which is controlled by the Chinese Communist Party, has paid more than $4.6 million to The Washington Post and . Should the PBOC stop interfering, most economists agree that the renminbi would self-correct and appreciate in value, thus making Chinese exports more expensive. Total number of residential properties bought by Chinese buyers in the U.S. 2010-21. U.S. companies with Chinese shareholders more than doubled their acreage that year, accounting for 102,000 acres of the growth. "GDP growth (Annual %) - China. That's when the U.S. Department of the Treasury changed how it measures the debt. And if you measure it by gross domestic product (GDP) and consider purchasing power parity (PPP), China is seen as the worlds largest economy. This amount is subject to market fluctuations. It buys available excess U.S. dollars from the exporters and gives them the required renminbi. ", The World Bank. ), after gaining momentum seeded in farm states. China is taking steps to make its currency, the yuan, transition to a global currency. 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. 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. Popular cinema company AMC, short for American Multi-Cinema, has been around for over a century and is headquartered in Leawood, KS. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s). Q4: What federal solutions are being discussed? Now China owns the airspace and Australian citizens can't land in their own country without approval from the Chinese government. Use Ask Statista Research Service. "Debt to the Penny. The answer to that question seems to be a constant source of controversy among Americas political leaders and media commentators. For example, Chinese pharmaceutical companies supply 70 percent of the world's acetaminophen, commonly used in Tylenol. 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. Stephen Gandel. 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. That move followed a contentious debate over the potential consequences for Asian Americans if Congress adopted a provision aimed squarely at China. The products are still made in the USA, but the decisions are made in China. 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. 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? Walmart is founded and owned by the Walton family. In return, American consumers get cheap Chinese products and incoming investment capital. 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. ", U.S. Department of the Treasury. China and investors tied to the CCP own just shy of 200,000 acres of various types of land in the United States. 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.. It could be bigger," he surmised. ", United States Department of Treasury. In addition, many economists contend that the reported U.S. debt should include at least another $120 trillion in unfunded future liabilitiesmoney the government does not currently have but is legally obligated to pay people in the future. And Human Rights Watch has written that China is an'existential threat' to human rights." Learn more about how Statista can support your business. The quick answer is that as of January 2018, the Chinese owned $1.17 trillion of U.S. debt or about 19% of the total $6.26 trillion in Treasury bills, notes, and bonds held by foreign countries. 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. For its part, China owned 191,000 acres worth $1.9 billion as of 2019. or redistributed. Michael Boyle is an experienced financial professional with more than 10 years working with financial planning, derivatives, equities, fixed income, project management, and analytics. Bipartisan pressure is building to stop foreign nationals from purchasing American farm operations and receiving taxpayer subsidies. What is the highest credit limit for Chase Sapphire? ", Total number of residential properties bought by Canadian buyers in the U.S. 2010-22, Total property sales to foreign buyers in the U.S. 2010-2022, Share of Indian buyers of residential property in the U.S. 2011-2022, Total number of residential properties purchased by Indian buyers in the U.S. 2010-22. Countries with lower currency values export more, since their products cost less when sold in foreign countries. The US National Debt and How It Affects You. For example, in water-scarce regions like the Southwest, outside use of freshwater resources can affect water availability for local farms and communities. 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. The PBOC can print renminbi as needed. Most states, like Texas and Maine, have no restrictions on foreign ownership of land, contributing to the large amount of farmland that is under foreign control in these states. Indeed, there has been a tenfold expansion of Chinese ownership of farmland in the United States in less than a decade. Mutual Fund and ETF data provided by Refinitiv Lipper. Indeed, there has been a tenfold expansion of Chinese ownership of farmland in the United States in less than a decade. Stoves, refrigerators, washers and dryers from General Electric have been around for more than 100 years, but starting last year, the appliance division of the iconic company has been Chinese. The extent of Chinese investment in recent years has also raised red flags around U.S. national security, particularly in the realm of rare earth minerals. 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. When this land changes hands, theyre going to gobble it up, he said of foreign buyers. 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. ThoughtCo, Sep. 2, 2021, thoughtco.com/how-much-debt-does-china-own-3321769. The real question is: How much of the totalU.S. debtdoes the U.S.federal governmentowe to Chinese lenders? USDA reported in 2018 that Chinas agricultural investments in other nations had grown more than tenfold since 2009. Maxwell said that poses a big risk with an older generation of farmers set to exit the industry. Erika Rasure is globally-recognized as a leading consumer economics subject matter expert, researcher, and educator. Owe China? More recently, U.S. authorities have discovered China is funding American university researchers, who don't always disclose those contributions. Amanda Jackson has expertise in personal finance, investing, and social services. Pallets of sod cover part of the 230 acre Kuenzi Turf & Nursery on June 2, 2021 in Salem, Oregon. Quotes displayed in real-time or delayed by at least 15 minutes. China has the second-greatest amount of U.S. debt held by a foreign country. 2023 FOX News Network, LLC. (2022). Over 40 percent of the additional 3.4 million acres acquired by foreign investors in 2019 was located in Texas, Oklahoma, and Colorado. On the other hand, if China were to call in its debt, the demand for the dollar could plummet. According to the International Monetary Fund (IMF), the only nation with no national debt is Macao SAR. 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. Chinas demand for Treasurys helps keep U.S. interest rates low. Subsequently, China and other international players would be obligated to accede to an audit that can be reviewed by the nonprofit Public Company Accounting Oversight Board, which oversees audits of all U.S. companies that endeavor to raise money in public markets. 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. "How Much Money Does the World Owe China? China also is liberalizing its control of the yuan, also called the "renminbi." We also reference original research from other reputable publishers where appropriate. "Major Foreign Holders of Treasury Securities.". 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. China could start this process only after it further expanded its exports to other Asian countries and increased domestic demand. Understanding the actual extent and impact of Americas debt to China requires a closer look at these massive amounts of money. IOUs are formed and financed through joint efforts of the U.S. Department of the Treasury and the Federal Reserve. That would hurt China's competitiveness by raising the yuans value relative to the dollar. Sudan has the most debt in the world, accounting for approximately 284% of its gross domestic product (GDP). 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. SWINE FLU STRAIN WITH 'HUMAN PANDEMIC POTENTIAL' FOUND IN MORE CHINESE PIGS, SCIENTISTS SAY. It has opened yuan trading centers in London and Frankfurt. Market data provided by Factset. 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. 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. 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. "Report on Foreign Portfolio Holdings of U.S. Forbes. The value will change whenever China trades Treasury securities or when the prices of those bonds change. 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. "We 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. CNBC's Uptin Saiidi explores some of China's biggest assets in New York and explains how the tr. 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. Greed Is Good or Is It? China must maintain its export-led growth to generate the number of jobs needed to keep its massive population productively engaged. That's a large portion of the $7.6 trillion in Treasury bills, notes, and bonds held by foreign countries. The debt ceiling is a limit that Congress imposes on the amount that the federal government can owe. Chinese lenders snap up so much of the U.S. debt for one basic economic reason: protecting its dollar-pegged yuan. https://www.thoughtco.com/how-much-debt-does-china-own-3321769 (accessed March 4, 2023). 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. The rest of the $29 trillion national debt is owned by either people in the U.S. or by the U.S. government itself. To do that, China had to loosen its peg to the dollar. Other top investors are American-based companies, including Vanguard Group Inc. Apple Inc USA is an American Company that was founded in Cupertino, California. US Navy laments China's shipbuilding supremacy February 27, 2023; US dangles F-35 to lure India away from Russia February 27, 2023; Ukraine marks the future of remote-control war February 23, 2023; China's 'phantom space strike' made to spoof US defenses February 23, 2023; US secretly amassing killer drone swarms to repel China February . This is just a small part of the 30 . Walmart does not own Dollar Tree as of 2022. 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. [Online]. You only have access to basic statistics. You can learn more about the standards we follow in producing accurate, unbiased content in our. Other foreign holders included oil-exporting countries and Caribbean banking centers. Six states Hawaii, Iowa, Minnesota, Mississippi, North Dakota and Oklahoma currently ban foreign ownership of farmland. Photo: GUILLAUME SOUVANT/AFP via Getty Images, Critical Questions The 2011 U.S. Debt Ceiling Crisis was a contentious debate on the borrowing limit of the United States government in July 2011. Investopedia contributors come from a range of backgrounds, and over 24 years there have been thousands of expert writers and editors who have contributed. "The first priority is to reclaim our critical supply chains so that we can become self-secure instead of reliant on the Chinese government,"Will Coggin, managing director of the American Security Institute, told Fox News. Office of the Historian. "Major Foreign Holders of Treasury Securities [2000-2020]. Her modest, two-story white farmhouse has . China owns roughly $1.08 trillion worth of U.S. debt. It allows the U.S. Treasury to borrow more at low rates. Center for Strategic and International Studies Powered and implemented by FactSet Digital Solutions. 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. Because of varying maturities dates, China would be unable to call in all its Treasury holdings at once. 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. A government bond is issued by a government at the federal, state, or local level to raise debt capital. 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. Walmart owns no shares. It's more of a novelty day like Valentine's Day, rather than a religious celebration. Please do not hesitate to contact me. David Schlessinger and I founded Five Below 16 years ago with a promise to build an amazing store for teens and pre-teens that offers trend-right, high-quality merchandise all at $5 or less, said Tom Vellios . However, the items are Manufactured and Assembled in China, with Foxconn, a Taiwanese-based firm, producing the majority of Apple's products. ", U.S. Department of the Treasury. This is the second reason the Chinese want Treasurys; they are essentially redeemable in dollars. Chinese firms have bought AMC Entertainment, Legendary Entertainment, and other media companies. The coronavirus pandemicmay have shed light on China'sinfluence in America over the supply chain,including life-saving medicines, technologyand equipment. Statista. We are new in this process, said Rep. Sanford Bishop (D-Ga.), chair of the agriculture appropriations subcommittee. Research Associate, Global Food Security Program. The post, which has been shared over 256,000 times as of April 14, is headlined with "read this before buying meat." "The hogs will still be raised here, but slaughtered and packaged for . The top two foreign holders of U.S. debt are Japan and China. Discover the current debt ceiling and its economic impact. Christmas in Mainland China is not a public holiday and is not related to religion at all. The NYFC also points to both urban and rural development as a threat to the future of U.S. farms, since converting farmland to other uses drives up prices and makes the land unaffordable for beginning farmers.