Since President Trump’s trip to Asia, much media attention was paid to the announcement of US$250 billion worth of investments and trade deals between America and China. However, this figure is likely inflated, as most of the deals were previously announced and approved, or are merely pending transactions and are therefore not considered new deals negotiated by Trump himself. Despite this, Trump did manage to bring home several deals that will add to the manufacturing job sector of the American Midwest—an important campaign promise in the 2016 American election. Overall, it is clear that Trump is not interested in strengthening trade with other world leaders, but is instead catering to American domestic audiences.
Since the conclusion of his Asia trip, President Trump described the deals made in Beijing as “tremendous, incredible, job-producing agreements”, while China’s Minister of Commerce Zhong Shan referred to collection of deals as “truly a miracle”. However, it is not clear that the total amount of new deals is anywhere close to the announced total: most of the deals signed were MOUs (memorandum of understanding), and it is likely that the value of the actual contracts will be substantially less than the speculated amounts agreed to in the MOUs. Likewise, many of the deals had already been announced, and were not new deals negotiated by Trump himself: in particular, a Beijing order of 260 narrow-body jets and 40 wide-body Boeing planes for US$37 billion was already part of a deal made in 2013. The announced trade and investment package allows Trump to portray himself as a deal-maker to domestic constituents, but are largely without substance.
However, among the new deals is a 20-year $83.7 billion greenfield investment by China Energy Investment Corp in chemical and shale gas development in West Virginia. This deal is important because it will likely result in new manufacturing jobs in an energy-producing state that voted heavily for Trump in the 2016 election. Given that one of Trump’s primary election promises was to bring back manufacturing jobs to mid-western America, this deal is significant.
America is the largest recipient of Chinese global investment. 2016 was a record year for Chinese FDI: the US received US$46.2 billion in Chinese investment (Rhodium Group). By comparison, Canada received CA$7.5 billion (CIUA) in Chinese investment. Cumulatively, America has received about 10% of total Chinese FDI, while Canada only received 3% (AEI). In 2016, the US received 20% of China’s total FDI, while Canada only received 1%. While not all investments for 2017 are currently announced or finalized, it is likely that Chinese FDI in both the US and Canada will be signficantly less than 2016. The MOUs agreed to by President Trump and President Xi are not finalized transactions, and therefore will not contribute to Chinese FDI in the US for 2017.