Economist points our a noteworthy projection for 2014, where outward direct investment surpasses inbound. Chart from the Rhodium group shows how the relative investment between US and China backs up this trend.
Investment flows: Going out | The Economist: Chinese firms are increasingly venturing abroad. Earlier waves of investors were led by state-owned enterprises in search of resources in Africa and Latin America. Today’s pioneers are often private firms. They seek brands, talent and technology to bring back to the Chinese market.
Rhodium Group New Realities in the US-China Investment Relationship: For decades, foreign direct investment (FDI) flows between the US and China were a one-way street: American multinationals invested in labor-intensive manufacturing and consumer-oriented operations in China, but Chinese firms had neither motive nor capacity to invest in the US economy. In the past 5 years this situation has changed profoundly, as Chinese investment in the US took off, and, by most measures, now exceeds flows in the other direction. This sea change suggests opportunity, but also a pressing need for policy leadership to ensure a success story does not turn into a new grievance.
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