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China Passes U.S. As No. 1 Destination For Foreign Investment As Coronavirus Upends Global Economy – Forbes

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Topline

As the world struggled to contain the coronavirus crisis, foreign direct investment in the United States plummeted 49% in 2020 while investment in China rose 4%, making China the largest recipient of foreign inflows for the first time, according to a report released Sunday by the United Nations Conference on Trade and Development. 

Key Facts

China pulled in $163 billion in new investments from foreign businesses in 2020 while the U.S. fell into second place with $134 billion. 

The U.S. and China had broadly different responses to the pandemic, with China’s government instituting strict, large-scale lockdown measures in early 2020 while the United States’ response was far less centralized and far less effective in curbing the spread of the virus. 

That prompted a major shift in the global economy—while the United States and other Western countries struggled to contain the pandemic, China went back to work, manufacturing picked up, and as a result China was the only major economy to report economic expansion in 2020. 

While the momentum of FDI has been shifting towards China for several years, the total stock of foreign investment is still larger in the United States, the Wall Street Journal notes.

FDI in India rose 13% in 2020, while FDI in the European Union fell by two-thirds.

The U.N. expects foreign investment overall to remain weak in 2021. 

Big Number

42%. That’s how much foreign direct investment fell across the globe in 2020, from $1.5 trillion in 2019 to $859 billion in 2020. Most of that decline occurred in developed countries, the U.N. said. 

Key Background

Despite increasingly frosty relations between the U.S. and China, western firms are continuing to pour their resources into the rapidly growing economy there. Last month, Goldman Sachs took full ownership of its Chinese joint venture partner. JPMorgan did the same in November. Tesla is ramping up production in China and early last year, PepsiCo spent $705 million to buy a Chinese snack brand.

Crucial Quote 

“U.S. and other foreign firms will continue to invest in China as it remains one of the most resilient economies during the global pandemic and as future growth potential there remains stronger than most other major economies,” Rhodium Group analyst Adam Lysenko told Bloomberg last month. 

Further Reading

China Overtakes U.S. as World’s Leading Destination for Foreign Direct Investment (Wall Street Journal)

Biden Will Be More Predictable Than Trump On Trade, But Don’t Expect Tariff Rollbacks Any Time Soon (Forbes)

China’s Growth Beats Estimates as Economy Powers Out of Covid (Bloomberg)

China’s Exports Surged 9.5% In August Despite Escalating Tensions With The United States (Forbes)

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Investment

Putin Offers Russian Railways Investment in New Indonesia Capital – Financial Post

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President Vladimir Putin offered to have Russian Railways invest in Indonesia’s new capital, in a sign of warming ties with Southeast Asia’s biggest economy as the US and its allies seek to isolate Moscow.

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(Bloomberg) — President Vladimir Putin offered to have Russian Railways invest in Indonesia’s new capital, in a sign of warming ties with Southeast Asia’s biggest economy as the US and its allies seek to isolate Moscow.

Putin said Moscow could take part in President Joko Widodo’s plan to move Indonesia’s capital to the island of Kalimantan from Jakarta, according to a statement by the Russian Embassy in the country. He made the comments during Jokowi’s visit to Moscow on Thursday, it said.

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Nusantara, as the new capital will be called, is set to begin construction in August after the pandemic stalled its development. Jokowi has courted investors including Abu Dhabi and Taiwan’s Foxconn Technology Group to help build a renewable energy-powered city from scratch. 

Russian energy companies are also keen to operate in Indonesia, especially in developing nuclear power, Putin added. Atomic energy is a key part of Indonesia’s net-zero emissions plan.

Indonesia has come under pressure by the US and other countries to prevent Putin from joining the Group of 20 summit, which is set to take place in Bali. The Russian leader made no comment on whether he’ll attend in person.

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Island's largest investment in affordable housing taking shape in Saanich | BC Gov News – BC Gov News

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Ahmed Hussen, federal Minister of Housing and Diversity and Inclusion –

“Everyone deserves a safe place to call home. Our government remains committed to working with our partners to ensure our seniors have access to housing that meets their needs. Today’s announcement is another important step in the right direction and will go a long way to support families in Saanich. This is the National Housing Strategy at work.” 

Parm Bains, Member of Parliament for Steveston–Richmond East –

“This investment from the National Housing Co-investment Fund is improving the economic and social well-being of the individuals, seniors and families who will soon call Nigel House their home and will make Saanich a better place to live. When people have a secure and stable home, they gain the confidence they need to succeed and fulfill their potential.”

Fred Haynes, mayor, District of Saanich

“It’s amazing what can happen when multiple stakeholders, including our local community associations, take a collaborative and proactive approach to challenges like housing. This project caters to a wide range of housing needs in Saanich and I look forward to seeing how it will enhance our community over the years to come.”

Derrick Bernardo, president and CEO, Broadmead Care –

“Broadmead Care has had a dream for years to build a new Nigel House. We are excited to see housing, health and social services coming together to make this dream a reality and more. The new Nigel House will be part of a beautiful community campus of care with a focus on aging in place, research and innovation.”

Geoffrey Ewert, CEO, Garth Homer Society –

“The Nigel Valley Project is a remarkable collaborative effort with the goal of meeting the needs of our diverse community. What we are creating is more than just housing – we are creating an inclusive community where people from all walks of life feel a true sense of belonging and have a place that feels like home.”

Bruce Homer, board chair, Garth Homer Foundation –

“The Nigel Valley project amplifies what can be achieved when stakeholders collaborate for the good of the community as a whole. Garth Homer is proud to be a part of this transformative initiative.”

Virginia Holden, executive director, Greater Victoria Housing Society –

“Greater Victoria Housing Society is really thrilled that we can increase the amount of affordable rental homes available in Saanich. We are very grateful to be a part of this strong partnership with the Province and other community non-profit organizations that will result in a transformation of this neighbourhood, and create a community where everyone feels at home.”

Chris Forester, executive director, Island Community Mental Health (ICMH) –

“Providing housing and recovery-oriented supports to people living with mental health challenges is at the heart of our work. ICMH is proud to partner in bringing 800 homes and the creation of an inclusive community to the Nigel Valley to serve so many of those in need.”

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Investment

Indigenous-led Winnipeg organizations' $620M investment plan proposes new hospital, housing – CBC.ca

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A hospital for Indigenous people and hundreds of new housing units are among the spending priorities laid out in an investment plan released Wednesday by a coalition of Indigenous-led organizations in Winnipeg.

The Winnipeg Indigenous Executive Circle — a coalition of 32 member organizations that work to support Winnipeg’s Indigenous population — is proposing a 10-year, $620-million spending plan, which it believes will make Winnipeg a better, healthier place for its communities.

“It’s essentially just laying out … in dollar terms, where we need help and where we see funding gaps that we need to actually hit these objectives,” co-chair Kendall Joiner said at at the Neeginan Centre on Higgins Avenue, where the plan was unveiled on Wednesday.

Spending proposals are broken down into four priority areas: health and well-being, housing and homelessness prevention, supports for families, and employment and education. 

One of the big-ticket items in the plan is a hospital specifically serving Indigenous people, estimated to cost $65 million.

The plan also calls for a commitment to build hundreds of new housing units, including supportive housing and units with rent geared to income, expected to cost at least $347 million.

Other priorities include $1 million for cultural programming through the Winnipeg Indigenous Friendship Centre and $1.2 million for the creation of Indigenous research institutes.

Leaders of the Winnipeg Indigenous Executive Circle —  whose membership includes organizations like Ma Mawi Wi Chi Itata Centre, End Homelessness Winnipeg and the Eagle Urban Transition Centre — say the goals in the plan would promote and elevate the work Indigenous-led groups are already doing.

“We’re a community that’s always been told, ‘this is what you need to do to move forward,'” said Crystal Laborero, chief executive officer of the coalition group.

“I think we’re in a day and a time that we are now realizing that … we have a lot of leaders in the community that are looking to make change for the urban Indigenous community and we have the solutions. We’re the experts in our field, so we feel that we can do this.”

The coalition says the plan shows governments and donors exactly what it would take to make Winnipeg a more welcoming and safer place for people who are First Nations, Métis and Inuit.

Success will be measured not by dollar value, but by how willing governments are to come to the table as equals, and how willing they are to understand that the Indigenous-led groups that make up the coalition know exactly what their communities need, the Winnipeg Indigenous Executive Circle said.

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