The dots connecting TikTok, US Steel and Chinese land buys – Asia Times

The dots connecting TikTok, US Steel and Chinese land buys - Asia Times

A bill that requires China’s ByteDance to promote TikTok to an British user or be outlawed is passed in the House of Representatives. President Joe Biden denounces Nippon Steel’s purchase of US Steel, saying it may continue to be American-owned. Washington and condition assets now pass a law to forbid Chinese land ownership.

Is the United States turning against international purchase?

Certainly judging from the data. In the third quarter of 2023, the US received the most foreign direct investment, according to the Organization for Economic Cooperation and Development ( OECD ). The US$ 73 billion it took in was 30 % higher than the$ 55 billion received by the 27 countries of the European Union and nearly triple the$ 26 billion of the No 2 country, Ireland.

TikTok, Nippon Steel and land are special circumstances, therefore, the welcome mat is usually still up. However, these unique circumstances merit investigation. They serve as a resource for further information on the types of investments that may turn out to be special circumstances in the future.

Investments that threaten national safety are at the top of the list. That’s not entirely new, the president’s Committee on Foreign Investment in the US, or CFIUS, has been doing federal safety assessments since its creation in 1975. The TikTok event, yet, suggests that the concept of national security is being broadened.

TikTok branding. Photo: Internet Matters

What troubled Congress was, initially, the potential for the business to share personal information on its 150 million American people with the Chinese government, and next, the agency’s ability to influence American elections.

TikTok demonstrated that capacity during the lead-up to the Parliamentary vote. Consumers were urged to speak with their representatives in its place. They did, great day. That’s political control.

Personal information and political influence were n’t always issues of national security. They are now.

Does this broadened concept just apply to investments made in China? Maybe. American politicians do n’t fret about the London- based Economist, which often endorses US presidential candidates. That’s not because the Analyst lacks effect, its US reader, print and electronic, is in the thousands. Because the United Kingdom is an ally, Washington does n’t care.

China is n’t. Many Americans view China as a risk. Whatever China does is politically vulnerable.

China’s possible threats to US crops include intellectual property theft and cyberattacks, but a lower- level risk, farmland purchases, attracts a lot of social interest. Photo: Elaine Shein / DTN files

So there’s the concern about Chinese ownership of American farmland.

China does pose serious potential threats to US agriculture, including theft of intellectual property and cyberattacks. Farmland purchases are a low- level threat.

China accounts for only about 1 % of the 3 % of US farmland owned by foreigners. Even so, politicians are up in arms. Kristi Noem, governor of South Dakota, claims that China is” buying up our entire food supply chain.”

Unlike China, but like the UK, Japan is a US ally. For various reasons, Nippon Steel’s proposal to acquire US Steel is a special case. One is the iconic status of US Steel, as I explained here. The other is that Cleveland- Cliffs, a rival bidder for US Steel, and the United Steelworkers ‘ Union have collaborated to oppose the deal.

Unions have a lot of influence during election years. Both candidates for president want union support. The steelworkers ‘ union soon endorsed Biden after he publicly criticized the acquisition.

Does this apparent quid pro quo kill Nippon Steel’s chances? Cleveland- Cliffs is reportedly telling Wall Street that the CFIUS review is still pending. It’s still possible CFIUS will rule the deal does n’t threaten national security.

There are ironies in Cleveland- Cliff’s campaign. While it’s urging the government to keep US Steel American, its CEO – Lourenco Goncalves – is Brazilian. A Cleveland-Clinton acquisition may have trouble surviving a review by antitrust regulators, even though Nippon Steel’s proposed acquisition must pass muster with CFIUS. Between US Steel and Cleveland- Cliffs, the two companies produce up to 80 % of the steel used by US automakers.

US Steel’s Edgar Thomson Plant in Braddock, Pennsylvania. Photo: Twitter Screengrab / Pittsburgh Post- Gazette

Foreign investors frequently introduce novel goods, procedures, and management strategies that benefit the receiving nations. Many Americans believe that TikTok provides a better user experience. Japan Steel might be able to impart a few lessons about steelmaking to US Steel. Before Japanese automakers started producing cars in the US a few decades ago, Detroit did n’t really address its quality issues.

The Japanese, for their part, have traditionally discouraged incoming foreign investment, though they’ve warmed to it some in recent years. According to Richard Katz’s book” The Contest for Japan’s Economic Future”, Japan ranked 169th out of 169 countries in a 2019 tally of foreign direct investment as a percentage of GDP.

Is it better to give than to receive foreign investment, as Japan seems to think? The US has long enjoyed doing both. Special cases notwithstanding, that’s likely to continue.

Former longtime Wall Street Journal Asia correspondent and editor&nbsp, Urban Lehner&nbsp, is editor emeritus of DTN/The Progressive Farmer.

This&nbsp, article, &nbsp, originally published on March 22&nbsp, by the latter news organization and now republished by Asia Times with permission, is © Copyright 2024 DTN/The Progressive Farmer. All rights reserved. Follow&nbsp, Urban Lehner&nbsp, on&nbsp, X @urbanize&nbsp,