Yahoo Finance Foreign Buyers With Ties To American Strategic Rivals Are Gobbling Up American Farmland And Real Estate Near US Military Installations
A recent report from the Government Accountability Office (GAO) has revealed over 40 million acres of U.S. farmland are owned by foreign investors, some of whom may be linked to America's strategic rivals such as China and Iran. The report shows that there has been a 40% increase in foreign land ownership in the US since 2016.
These foreign-owned properties are spread throughout the United States, and perhaps more alarmingly, they include some of America's most valuable farmland as well as numerous properties near U.S. military installations. The GAO's findings raise concerns about America's food supply and its vulnerability to foreign intelligence operations. The reaction on Capitol Hill was one of bipartisan concern.
A Massive Blindspot At The US Department of Agriculture
The U.S. Department of Agriculture (USDA) has a legal obligation to collect data on foreign ownership of American farmland. The requirement has existed since the Agriculture Foreign Investment Disclosure Act (AFIDA) of 1978, which has a provision requiring foreign people who purchase or transfer agricultural land in America to report the transaction to the USDA.
Although the USDA has much of this data, the GAO report found significant issues with its data collection and record review process.
The USDA "does not sufficiently verify and conduct quality reviews to track the accuracy and the completeness of its collected data," the report states. What that means is that the USDA probably lacks a complete picture of how much U.S. agricultural land is under foreign ownership.
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Is The 40 Million Acres A Drop In The Bucket, Or Is There More?
According to the USDA, America has 1.4 billion acres of privately held farmland. On the surface, the fact that 40 million acres of that land is under foreign ownership would not seem like cause for alarm. However, the USDA's tracking and data-sharing methods are so antiquated that the GAO report found no USDA record of the $85 million purchase of 200,000 acres of land in Oregon forest country by Chinese billionaire Chen Tianqao.
The purchase makes Tianqao, who allegedly has links to the Chinese Communist Party, one of the largest private landholders in America. The news of his purchase, and the fact such a large acquisition happened right under the USDA's nose despite the reporting requirement, has prompted a flurry of proposed legislation at both the state and federal levels to try to restrict or more effectively monitor foreign ownership of agricultural land inside the United States.
Montana Senator's Proposal
U.S. Sen. Jon Tester (D-Montana) has proposed legislation called the Agricultural Foreign Investment Disclosure Act (AFIDA) of 2024, which would strengthen the USDA's recording and reporting requirements. He has also sponsored the Promoting Agricultural Safeguards and Security Act, which would stop strategic rivals such as China, Russia and Iran from owning agricultural land in the United States.
The long-term implications of foreign buyers owning agricultural land in the United States are not known, but it has the potential to be problematic. If for example, there was a global food shortage of a key U.S. crop, would farms owned by foreign interests sell those crops inside the United States or export them out of the country? The fact that the question has no clear answer underscores the necessity of legislative action.
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