WASHINGTON, Aug. 25 (UPI) -- Chinese firms are seeking to diversify their revenue streams with purchases of U.S. companies, a market analyst said.
With an export-oriented economy, "Chinese companies need to escape the profit squeeze in low-end manufacturing and move up and down the value chain. Expanding investment in developed economies is an essential part of that," said Thilo Hanemann, a research director at Rhodium Group.
The Los Angeles Times reported Saturday that Chinese investments in the United States are at $8 billion so far this year, which puts it on a record-setting pace.
In 2007, Chinese investments in the United States, separate from the government's bond buying, was at a record of nearly $9 billion.
The investments include several big deals. China Petrochemical Corp. has spent $2.5 billion to buy one-third of Devon Energy Corp. of Oklahoma City. Dalian Wanda Group purchased movie theater company AMC Entertainment for $2.6 billion.
In addition, Wanxiang Group, which makes auto parts, said it planned to invest $465 million in Waltham, Mass., company A123, which makes batteries.
That provoked a complaint from Rep. Cliff Stearns, R-Fla., who pointed out that A123 was given a $249 million grant from the Department of Energy.
That meant U.S. taxpayer dollars will benefit a rival of the United States, Stearns complained.