Due to the virus and the US- China relations in the past and the hampered economies of all the countries because of the pandemic led to the drop in China’s direct investment to U.S. It has dropped to lowest level since 2009 and disappeared around $200 million between January to March.
Direct investments include mergers, acquisitions and investments in things like offices and factories excluding financial investment like purchases of stocks and bonds. The abrupt decline in Beijing’s investment in United States reflected the tensions between world’s two biggest economies. Not to forget about the trade war which is on the peak since last few years as it dropped by $5.4 billion in 2018 and $5 billion last year.
United States uplifted its investment in China by $1 billion since last 2018 and now stands at $14 billion. US is worried about China taking advantage of the access that States have provided like its sensitive technology as a law was made compulsion it 2018.
To gain technological dominance China uses abusive tricks, letting out the trade secrets by forcing them and cyber theft which United States let go or sparred the charges for China being illegally dominant. After Donald Trump accusing of China being responsible for spreading of virus and forming as a strategy to take down the nation’s economy. Trump now has imposed tariffs of about $360 billion worth of Chinese goods as the pandemic took the whole economy down.
Lately the Trump Administration and Beijing even reached to an interim trade agreement in January to simplify the tensions. But the deal was taken aback by the pandemic.