China’s lightspeed economic rise is the global economic story of the last half century. And as MainFT’s China Shock 2.0 series has showcased, they’re not done yet. Last week a paper quietly dropped co-authored by a group of academics and policy types that helps put data meat on the bone as to how exactly technology transfers might have helped China’s latest step up.
Luc Laeven, director general of the ECB’s research department, along with co-authors professor Jenny Bai of Georgetown, and Hong Ru and Yaojun Ke of Nanyang Technological University, assembled a micro-level dataset of 161,773 firms across 159 countries. They then built multi-layered ownership chains to trace capital through offshore tax havens to its ultimate origin — which they reckon account for over 80 per cent of global assets of non-financial firms.
What they found were Chinese investors with around $3.3tn of global corporate assets skewed heavily to Europe (42 per cent of outbound investment) and North America (38 per cent).