Outlines Benefits and Challenges of Pursuing Investment Opportunities
WASHINGTON, D.C.–The U.S. Chamber today released a report, commissioned by the U.S.-China CEO and Former Senior Officials’ Dialogue, assessing the opportunities for Chinese investors for U.S. infrastructure. As the United States’ second-largest trading partner, China is well positioned to participate in U.S. infrastructure expansion and modernization. The report, “From International to Interstates: Assessing the Opportunity for Chinese Participation in U.S. Infrastructure,” identifies the benefits and complexities of pursuing such investment opportunities and provides practical advice for potential participants.
“Two-way infrastructure investment has emerged as one of the most promising opportunities to spur economic growth and job creation in both the United States and China,” U.S. Chamber President and CEO Thomas J. Donohue said. “This type of investment would benefit both of our countries, strengthening our relationship and enhancing global stability and prosperity.”
The report shows that the pressing need for resources to modernize U.S. infrastructure is creating new opportunities for Chinese investors to act as providers of capital, goods, and services in areas such as civil engineering, architecture, construction, and contract and life-cycle management. At a minimum, more than $8 trillion in new investment will likely be needed in U.S. transportation, energy, and wastewater and drinking water infrastructure from 2013 through 2030—totaling some $455 billion per year. However, making the most of these opportunities will require careful navigation of the legal, regulatory, and political landscape in the United States.
“The infrastructure investment opportunities available to Chinese businesses are significant, but achieving them will likely be a complex undertaking,” Donohue continued. “This report illustrates that identifying and pursuing potential investments, as well as anticipating challenges, will require planning and patience by Chinese parties and their U.S. counterparts.”
The report also helps firms develop strategies to address likely challenges, including national security concerns, adverse reactions to foreign ownership, quality control and product safety, after-sale service, inadequate legal remedies, and legal and regulatory requirements governing outbound investment from China.
Additionally, the report provides concrete and pragmatic recommendations to Chinese parties and their U.S. counterparts contemplating participation in U.S. infrastructure that can lead to successful investment outcomes. Understanding U.S. national security concerns and the country’s regulatory landscape, prioritizing transparency and legal compliance, being mindful of how other global investments may impact investments in the United States, investing in U.S. operations, and developing relationships and a comprehensive strategy to manage risk will help potential investors take full advantage of valuable opportunities.
The report was released following the conclusion of the fifth meeting of the U.S.-China CEO and Former Senior Officials’ Dialogue, which is co-chaired by Donohue and China Center for International Economic Exchanges (CCIEE) Chairman and former Chinese Vice Premier Zeng Peiyan.
International trade and investment is a key component of the Chamber’s 2013 American Jobs and Growth Agenda, an ambitious plan to generate stronger economic growth, create jobs, and expand opportunity for all Americans.
The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations. Its International Affairs division includes more than 50 regional and policy experts and 25 country- and region-specific business councils and initiatives. The U.S. Chamber also works closely with 116 American Chambers of Commerce abroad.