WASHINGTON,(Reuters) – U.S. Treasury Secretary Henry Paulson said on Wednesday he feared that support for keeping U.S. markets open to foreign investment was breaking down.
“For many years, there’s been a bipartisan consensus in this country that an open economy is essential to our economic strength,” Paulson said in an interview on CNBC television.
“Regrettably, I’ve seen signs that this consensus is beginning to erode here and elsewhere in the world,” he said, adding that he intended to “go on the offense and make it very clear that we’re open for foreign investment and we appreciate the benefits of foreign investment.”
Paulson was scheduled to participate in a panel discussion at a Washington university on Thursday that aims to highlight how foreign investment supports U.S. jobs and growth.
He said foreign direct investment in the United States peaked in 2000 and had declined and then leveled off.
“It certainly hasn’t grown commensurate with our growth and as I travel around the world there are some that, in the wake of the Dubai Ports confusion and publicity, are questioning whether we really welcome investment,” Paulson said.
Dubai Ports World, which is owned by the United Arab Emirates, ran into problems trying to acquire a company that managed some U.S. ports. Some U.S. lawmakers objected that national security could be jeopardized, leaving some bad feeling among foreign investors about whether they were welcome in the United States.
“It’s too early to make any judgment whether this tailing off of growth in foreign investment in the U.S. is a temporary phenomenon or it’s a trend,” Paulson said. “But either way, we just want to make it very clear that we welcome foreign investment and it’s vital to our economic strength going forward.”
Paulson noted that legislation to streamline the operations of the Committee on Foreign Investment in the United States, which he chairs and that screens proposed investment that might pose a threat to national security, was still on the works.
He said only a small percentage of foreign investment proposals come before the committee for review and most of them never raise any controversy, “so we’re open for investment, we welcome investment from all parts of the world.”