China Should Invest in U.S. Real Estate and Other Sectors said Robin Trehan

Oct. 5, 2009 - PRLog -- Robin Trehan said even with the financial turmoil the rest of the world is facing, China Investment Corp (CIC) still has its $200 billion sovereign wealth fund intact. Fortunately, it will be put to great use -- to build up the global economy. Why would China do such a thing though? Are they just great Samaritans? Well, if you look deeper, you will see that China has been deeply effected by the financial crisis more than one may believe. Since financial woes are on a global scale, it has caused a downturn in growth production for China and the rest of Asia, which has been integrated with the global economy for the past decade.

Being that manufacturing demands have lowered, so has Asia’s revenue. This eventually lead to even more problems for the country, including job security issues, downing of the country’s GDP, slowed industrial markets and enterprise complications. By China investing in U.S. real estate in the various sectors around the globe, it will help to stabilize the market and relieve a lot of the financial stress we are facing. It would also benefit China because in the future, when the economy balances out again, they will be able to sell the properties, they bought at great bargains, at double or triple the cost they were acquired for. It’s a win-win for everyone. China is already looking to invest $2 billion in the U.S. real estate market. It will be used to buy taxpayer subsidized investment funds that have developed harmful mortgage-backed securities from banks around the nation. The CIC believes that acquiring these assets will be a lot safer than purchasing into the U.S. Federal Reserve’s Term Asset-Backed Securities Loan Facility (TALF).

Rumors suggest that CIC will also be investing in other major countries like the U.K. and Middle East. They are also being urged to invest in Africa’s manufacturing sector. So far, China has mainly invested in Africa’s services sector. There are various Chinese companies in regions like Zambia. When the mines there were about to be closed by other companies, China came in and kept them operational. It seems that China has long-term plans for partnership with Africa.

The more sectors China invests in, the better the countries become financially and the greater China will become after they reap what they sowed from helping out these falling markets. Now, only time will tell said Robin Trehan

Robin Trehan is partner at Credit Capital Funding. He can be reached at www.creditcapitalfunding.com or www.businesscreditfunding.com

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