U.S. States Divesting from Chinese Companies
The U.S. is experiencing a growing trend of states divesting from Chinese companies, citing national security concerns. This movement has been fueled by a growing perception of China as a threat, particularly among politicians seeking election.
Missouri Leading the Charge
Missouri Treasurer Vivek Malek has been a vocal advocate for divestment, successfully pushing the state’s retirement system to pull its investments from Chinese companies. He is now using this accomplishment as a campaign platform for his reelection bid.
Other States Following Suit
Indiana and Florida have also implemented restrictions on public pension funds investing in certain Chinese companies. While similar legislation was vetoed in Arizona and proposed in Illinois and Oklahoma, the movement shows no signs of slowing down.
A Growing Trend
This trend of divestment from China is part of a broader movement targeting foreign ownership of U.S. land. Several states have introduced laws restricting foreign ownership of agricultural land, with some specifically targeting Chinese citizens. Florida’s law even prohibits Chinese citizens from buying property within 10 miles of military installations.
The Economic Impact
A report by Future Union, a pro-democracy group, found that U.S. public pension funds and university endowments invested approximately US$146 billion in China between 2018 and 2022. The impact of divestment on these investments remains to be seen.
Cryptocurrency Considerations
While the focus is primarily on traditional investments, the U.S. government is also taking steps to address potential national security risks related to cryptocurrency. President Biden recently blocked a Chinese-backed cryptocurrency mining firm from acquiring land near a Wyoming nuclear missile base, citing national security concerns.
A Complex Issue
The issue of divestment from China is complex and raises several concerns. Some argue that divestment could negatively impact the U.S. economy, while others believe it is a necessary step to protect national security. The debate is likely to continue as the U.S. navigates its relationship with China in the years to come.
