As the U.S.-China trade war rages, two-way foreign direct investment (FDI) is plummeting. So far this year, combined two-way U.S. and Chinese FDI totals just $9.9 billion – its lowest six-month value in five years. At the same time, venture capital investment is becoming an increasingly bigger piece of the U.S.-China investment puzzle.
Foreign direct investment (FDI) is a vehicle for gaining entry into growth markets. In theory and in general, it’s a win-win. In practice and locally, it will depend on each deal. Global FDI flows have taken a dive, in part due to a souring investment climate and uncertainties in trade policies, but they are critical for growth in developing and developed markets alike.
80 percent of all global trade is transacted through third-party lenders and cargo insurers, but the process is complex, can be costly and many banks find it too risky to support small and medium-sized enterprises (SMEs). Blockchain has the potential to increase transparency, speed and accuracy in assessing risk across the trade finance process, which in turn could expand the supply of credit available for SMEs.
Economists can’t tell you how tariffs impact your own business, your job or your shopping cart. Nonetheless, as tariffs are set to go higher, we look at how economists are dialing the tariffs into their forecasts about growth for the U.S. and global economy.
The United States has nearly 8,000 economic sanctions in place, and the list is growing. The muscle behind an array of U.S. financial sanctions derives from the reach and power of the U.S. dollar as the “lead currency” in the global economy.
As global trade grows and increases in complexity, trade-based money laundering has become the weakest link in anti-money laundering initiatives. Banks and government officials are strengthening international collaboration to crack down on criminals who hide and launder their dirty money in global trade transactions.
Cambridge is a major hub in Massachusetts’ life sciences ecosystem. What makes up the DNA of vibrant biopharma and medical device industries? Trade associations, overseas governments and investors, and U.S. government agencies at the federal, state, and local levels are all part of the prescription for economic growth.
Chinese investments in the United States plunged while U.S. investments in China flatlined. See what’s driving these trends on the US-China FDI Project website.
The BUILD Act enjoyed bipartisan support in the Congress because it represents to many in the development policy community a smarter, more modern way to advance development objectives. The new development financing agency it creates will also provide an alternative to China’s aggressive financing of infrastructure projects in developing markets.
At the same time the United States is considering cutting funding for diplomacy and development by 30 percent, China doubled its diplomacy budget over the last five years, proposing to increase its foreign affairs budget by 15 percent in 2018 alone.