A bit of apprehension
Many Chinese entrepreneurs remain wary of entering the U.S., uncertain about restrictive visa rules, language and cultural barriers and the political environment. Recent tensions related to Tibet and the Olympic torch relay have spurred calls in China to boycott Western companies. But no one says that's slowing the march of Chinese companies into the world's biggest economy.
"They don't want to miss this opportunity to bottom-fish in the U.S.," said Mei Xinyu, an economist at China's Ministry of Commerce, referring to the depressed asset prices in a sluggish American economy.
Flush with cash, many Chinese companies want to compete globally. Others feel they've hit a wall in the domestic market and need to go out to expand sales. And the Chinese government is urging them on by loosening previously cumbersome restrictions, in part to help Beijing reduce a lopsided trade balance with the U.S. and make the most of its massive foreign reserves.
"At seminars and talks, government authorities are saying, 'You're a capitalist; you should be going out,' " said Fred Hong, a Pasadena lawyer who has worked in Guangzhou for 15 years advising Chinese companies.
One of Hong's clients, a Wenzhou man who operates two printing factories in China, recently signed a deal to spend $1 million to buy a 60-worker plant in the City of Industry that makes magnetic cards. Hong said the man's factories had produced strong profit in the last several years, leaving him with a pot of cash. With the dollar having lost nearly 10% of its value against the Chinese currency in the last 12 months, the yuan can go a lot further in the U.S.
Changing direction
For years, investment between the U.S. and China flowed one way, with American firms spending billions in the Asian nation. But the Beijing government's $5-billion stake in Morgan Stanley and $3-billion investment in the private equity firm Blackstone Group brought China's overall investments in U.S. firms to $9.8 billion in 2007, up from $36 million the year before, according to Thomson Financial.
By comparison, U.S. investment in China was $2.6 billion last year, down from $3 billion in 2006, said China's Ministry of Commerce.
But many Chinese entrepreneurs prefer to keep a low profile, and experts say those figures don't include a lot of investment activity happening under the official radar.
