{"id":49967,"date":"2017-02-02T16:43:50","date_gmt":"2017-02-02T22:43:50","guid":{"rendered":"http:\/\/news.medill.northwestern.edu\/chicago\/?p=49967"},"modified":"2017-02-03T06:59:46","modified_gmt":"2017-02-03T12:59:46","slug":"chinese-investment-chicago-trump-china","status":"publish","type":"post","link":"https:\/\/news.medill.northwestern.edu\/chicago\/chinese-investment-chicago-trump-china\/","title":{"rendered":"A hazy outlook for Chinese investment in Chicago"},"content":{"rendered":"

By Shen Lu<\/strong><\/p>\n

First it was Japan. Now China.<\/p>\n

The investment capital that China, Chicago\u2019s shiny new investment star, injects into the local economy has reached new highs almost every year since the Great Recession.<\/p>\n

Chinese investment in Illinois — primarily concentrated in the greater Chicago area — hit a whopping $5.5 billion last year, more than 350 times the $15 million invested in 2009, according to the Rhodium Group, a New York-based research firm tracking Chinese investment in the United States<\/a>.<\/p>\n

Since 2000, Chinese interests have invested $9.4 billion in the state, making Illinois the largest recipient of China\u2019s outbound investment after California and New York. The investment boom took off after Mayor Rahm Emanuel signed a Gateway Cities Agreement<\/a>\u00a0with eight Chinese cities in 2013, becoming an important U.S. gateway point for Chinese investment and tourism.<\/p>\n

\u201cWe determined that a strong effort on China and working on a greater Chinese investment environment would be in our interest, and we\u2019ve been proven correct,\u201d said Andrew Spinelli, director of global strategic initiatives at World Business Chicago, in a phone interview. \u201cSince signing that gateway cities agreement, we\u2019ve seen record-breaking investment every single year in Chicago.\u201d<\/p>\n

It is a marriage driven by political willingness that \u00a0reflects the cash flush Chinese firms\u2019 ambitions for global expansion, desires for technology innovation and local governments\u2019 increasing appetite for foreign capital.<\/p>\n

Yet it seems Chicago\u2019s darling investor is facing a somewhat hazy future in the Trump era. All the efforts Chicago has made to woo Chinese corporations, along with the resulting economic, cultural and academic benefits both sides have enjoyed, might be curbed by growing inward-looking policies.<\/p>\n

In the U.S., that\u2019s taking the form of greater scrutiny by President Donald Trump\u2019s administration, while in China, officials have put stricter rules in place to discourage the outflow of capital.<\/p>\n

\"An
An overview of Chinese investment in Chicago. (Shen Lu\/MEDILL)<\/figcaption><\/figure>\n

The Chicago-China marriage<\/h2>\n

About 96 percent of Chinese capital enters Illinois through acquisitions. The rest is called greenfield investment, meaning companies set up facilities and create local jobs. To the city, job-creating and tax-generating greenfield investments are pivotal.<\/span><\/p>\n

Chicago hosts more than 80 Chinese firms, 72 percent of all Chinese facilities across the state. These companies together have created more than 2,110 jobs, according to a Rhodium study<\/a>\u00a0published in 2016.<\/p>\n

Up until 2013, the most heavily invested sectors by Chinese corporations were transportation, infrastructure and automotive components manufacturing. Since then, Chinese companies have poured substantial capital into Chicago\u2019s real estate and information technology sectors, now the two leading industries receiving Chinese money.<\/p>\n

The big deals<\/span><\/h3>\n