China's global investment has "plunged" this year and probably won't recover anytime soon, a conservative think tank concluded.
The American Enterprise Institute published a report on Wednesday highlighting a "clear change" in China's global investment and construction projects within the past nine months. Since the beginning of 2019, investment fell more than 50 percent from a year earlier, AEI's Derek Scissors writes.
He cites "greater foreign hostility toward Chinese investment, starting with but not limited to the U.S." as one possible reason, but pins the "principal explanation" on Beijing's newfound "rationing" of foreign currency, which it typically gives to state-owned corporations to finance purchases and projects abroad. One outlier in this trend is in countries associated with Chinese President Xi Jinping's signature foreign policy: the "Belt and Road" initiative to extend China's sphere of influence through infrastructure building in Asia, Europe, and Africa. That spending has fallen more "modestly" since 2018, Scissors found.