Paul Swenson, president of the Council of American States in China, said all US states offer incentives to foreign investors. Some states offer tax rebates for electric vehicles, while others provide free specialized training. Provided to China Daily

BEIJING - US states are welcoming Chinese investments more than ever, a top official from the Council of American States in China said.

"We have seen a dramatic increase in Chinese investment into the US as well as the number of states, which have either shifted their focus to Chinese investment or opened new offices in China to work together with Chinese investors," said Paul Swenson, the council's president.

The association has offices of 35 US states and cities in China. The association aims to provide education and opportunities for Chinese companies to better access the resources offered by US state governments.

Swenson, who is also the director of representative offices in the states of Minnesota, Mississippi, Oregon and Wisconsin, said that every state has its own framework and they are allowed to provide flexible policies to investors.

"All US states offer incentives to foreign investors, and each case is considered based on their own quality, either by the number of jobs created or tax revenue generated or the industry that the state is really trying to develop," Swenson said.

The state of Oregon is passing regulations to use electric trucks for store deliveries, and their incentive programs are offered in the form of tax rebates for companies producing and utilizing clean energy and new materials.

In the state of Mississippi, on the other hand, where the labor and land cost are comparatively lower, the local and state level governments provide free training to employees of Chinese manufacturers and help to set up specialized training programs at no cost.

"If any Chinese investors need a little money with the initial startup construction, they could issue bonds at the local and state level to assist with the construction," Swenson said.

Chinese enterprises have established operations in 35 states in the US, according to a report by Asia Society's Center on US-China Relations and the Woodrow Wilson International Center for Scholars at the Kissinger Institute on China and the United States.

Chinese direct investments in the US amounted to $5 billion in 2010, creating more than 10 million jobs.

The report estimates that if China follows the development model of other emerging economies, by 2020, China's overseas direct investment would exceed $1 trillion, a significant part of which would flow into the US.

Swenson said that the major reason for the growing interest in Chinese capital is China's strong economic performance in the gloomy global economy.

Steven Zou, managing director of Pennsylvania Office of Trade and Investment in Beijing, agreed with Swenson's idea and explained that Chinese investors have changed their attitudes toward overseas investment because they have more capital.

"A few years ago, a $1-million investment was quite rare, but now, we often deal with $10-million investment from China," said Zou.

This year, China's investment in the US on six new projects and five acquisitions during the first three months of the year totaled $758 million, according to data from the Rhodium Group, an advisory company.

These investments cover a wide range of industries from manufacturing and chemicals to research and development and marketing.

"At first, Chinese people invested in the US because they were familiar with it after years of international trade. They set their plants in the US because the 'made in USA' products would bring higher revenue and the country is an international platform for their global expansion. But now, more investors are viewing the US as just one stop in their global expansion," Zou said.

Zou said that 14 states in the US have established offices in Beijing.

Swenson said that the benefits from Chinese investments are great because it brings together a large number of people and communities.

"One of the biggest advantages of these investment is job creation in a wide variety of sectors, and the construction of schools, hospitals and law firms. Eventually it would build up a Chinese-related business, such as supermarket and restaurant," Swenson said.

Wei Jianguo, secretary-general of China Center for International Economic Exchanges, said in a recent conference that the Chinese government encourages and supports leading enterprises to expand globally and directly invest overseas.

"In my opinion, the mutual investment between China and the US, especially China's direct investment in the US, is having a good start this year. And I am confident about the future," Wei said.

China Daily