In a surprising revelation, a new report by AidData, a research lab at the College of William & Mary, has uncovered that the United States is the largest beneficiary of loans from Chinese state banks, despite Washington’s longstanding warnings against such financial ties. Over the past 25 years, China’s state lenders have channeled approximately $200 billion into U.S. businesses, often through opaque routes involving shell companies in jurisdictions like the Cayman Islands, Bermuda, and Delaware. This secrecy has obscured the origins of the funds, raising alarms about the implications for U.S. national security and critical technologies. Much of the lending has facilitated Chinese companies in acquiring stakes in U.S. firms tied to robotics, semiconductors, and biotechnology—sectors vital to both economic and military strength. The report highlights a sophisticated and far-reaching lending network that extends beyond developing nations to wealthy countries, including the U.K., Germany, Australia, and the Netherlands. Former White House investment adviser William Henagan described the situation as a strategic game where China has gained a significant advantage, stating, ‘Wars will be won or lost based on whether you can control products critical to running an economy.’ The U.S. has historically welcomed foreign investment, but Chinese financing has drawn heightened scrutiny due to its alignment with Beijing’s strategic goals. The AidData report found that China has lent over $2 trillion globally since 2000, with a significant portion targeting critical minerals and high-tech assets in advanced economies. The lack of transparency in these transactions, often masked by Western-sounding shell companies and confidentiality agreements, has made it challenging to fully assess the extent of China’s influence. While U.S. screening mechanisms, such as the Committee on Foreign Investment in the U.S., have been strengthened in recent years, China has adapted by establishing over 100 overseas banks and branches to further obscure its financial activities. The report underscores a shift in China’s use of state credit from promoting economic development to securing geo-economic advantages, raising global concerns about its intentions to control critical economic and technological sectors.
US has warned others to avoid loans from Chinese state banks. But it’s the biggest recipient of all
