Toxic mood over China's investment in the US
- Source: Global Times
- [01:36 December 23 2009]
- Comments
Another sensible business deal between a Chinese company and a US firm fell victim to Washington's outdated attitude toward China.
CFIUS, an inter-agency US government committee, recommended to President Obama Monday to thwart a Chinese resource company, Northwest Non Ferrous International Investment Company (Northwest), from buying a controlling share in the American gold company, Firstgold.
The attempt to block the $26.5 million deal reveals the deep suspicion that some US politicians continue to harbor against China.
The reasons cited betray the familiar obsession – that the investment would put US national security interest at risk. Firstgold is located 80 kilometers from a training site of the Nevada-based Fallon Naval Air Station. There is also the US concern over China hoarding gold.
A senior executive of Firstgold says they have no intention of replacing existing staff with Chinese employees. Proximate goldmines involving foreign investment are already in operation.
China's effort to stock more gold, if true, is realistic. As the largest holder of US treasury bonds, China has to hedge the risk by betting on other assets, as there is least certainty about US dollar's value.
Northwest has backed off from the deal as a result of insurmountable political barriers. Of the foreign investment transactions reviewed by the CFIUS, there was only one case blocked by the US president. It may not be a coincidence, that this single case also involved a Chinese company way back in 1990.
