Foreign Investments

Inspired by a firestorm of criticism last year over a proposal to allow a United Arab Emirates firm to run terminals at U.S. ports, the House unanimously passed legislation Wednesday granting the government broader powers to review investments by foreign entities. "This is a bill that ensures national security while encouraging economic development," said Rep. Carolyn B. Maloney (D-N.Y.), the legislation's sponsor.

Intel Corp. has received government approval to build a $2.5-billion microchip manufacturing operation in China's northeastern coastal city of Dalian, a regulatory agency in Beijing said Tues- day. The long-rumored investment would be a significant boost for China's high-tech industry and the nation's bid to become a leading producer of high-value goods.

Chevron Corp. is in the midst of making an investment of about $1 billion in Russian oil company OAO Gazprom Neft, U.S. Deputy Energy Secretary Clay Sell told a group of journalists in Moscow. Sell declined to say more about the nature of the investment, however, leaving the details of the deal unclear. Representatives of the two companies, which agreed this year to form a joint venture for future projects, declined to comment.

For all its travails in the global economy, the United States has always been able to boast that Americans earned more money on foreign investments than foreigners earned here. No more. In 2006, foreigners gained $7.3 billion more on their investments here than Americans garnered abroad, according to Commerce Department data released Wednesday. It was the first "investment deficit" since the government began collecting such statistics in 1946.

United Commercial Bank plans to make history by purchasing a Shanghai financial institution and becoming the first Chinese American community bank to offer a wide range of services in China. With Business Development Bank Ltd., which United Commercial said Tuesday that it had agreed to buy for $205 million, the San Francisco-based bank could offer its customers a one-stop shop in the U.S. and China.

Along a scenic beach where fishermen mend their nets by hand, an endless row of storefronts stretches into the distance, all selling the same thing. Not sunscreen, umbrellas or cold drinks. Land. Never mind that the area is home to a violent separatist movement, or that foreigners are regarded with suspicion by police.

China has agreed to acquire a $3-billion stake in U.S. private equity firm Blackstone Group in a deal that marks that country's long-anticipated move to expand how it invests its massive foreign exchange reserves. The transaction calls for China's upstart state investment company to buy nonvoting shares in the buyout firm, concurrent with Blackstone's highly anticipated initial public offering of its management division, which is expected to raise as much as $4 billion.

For years China has been the world's factory floor, churning out plastic toys, appliances and socks. Now it's entering the world of very high finance. Moving for the first time to diversify its massive foreign-exchange reserves, the Chinese government agreed over the weekend to acquire a $3-billion stake in Blackstone Group, a huge investment firm that at the same time plans to sell an additional $4.75 billion of its shares to U.S. stock market investors.

The government of Colombia announced capital controls on some foreign investments Wednesday to try to curb the soaring peso. Finance Minister Oscar Zuluaga said that starting immediately, foreign portfolio investors will be required to deposit 40% of their investments in non-interest-bearing accounts in the central bank for six months. The measure is designed to absorb a glut of dollars and discourage speculative investing.

\o7A\f7T the halfway point of the year, you probably have substantial portfolio gains to celebrate. Now, how best to hold on to them? Financial advisors seem virtually unanimous in warning clients to be prepared for a stormy time in stock and bond markets in the second half of the year. In part, that's just standard professional caution. But it also reflects the clouds that have materialized in recent weeks. The woes of the U.S. housing and mortgage sectors continue to deepen.