Nikki Haley misleads town hall audience on Chinese land acquisitions

“I saw something on the internet that said you gave China thousands of acres of land in South Carolina. Why would you do that?”

— audience member asking a question at a Haley for President town hall in Boone, Iowa, Oct. 9

“Don’t believe what you read on the internet. … We didn’t sell any land to the Chinese. But, yes, I recruited a fiberglass company.”

— former South Carolina Gov. Nikki Haley (R), in response

In her campaign for president, Haley has warned repeatedly about Chinese investments, including land purchases, in the United States. Yet as governor from January 2011 to January 2017, she recruited Chinese companies to her state. Chinese capital investment in South Carolina more than doubled from $308 million in 2011 to nearly $670 million in 2015.

There’s nothing wrong with politicians changing their positions in light of new facts. Haley has become a hawk on China, making her stance a key part of her campaign platform, and many politicians in both parties, including President Biden, have become alarmed by China’s behavior. But her response at the town hall was false and misleading. The audience member asked whether she “gave China thousands of acres of land.” She answered that “we didn’t sell any land to the Chinese,” specifically mentioning a fiberglass company.

This is political sleight of hand — denying something that was not asked.

The fiberglass deal did not involve the sale of land — but that’s because the company received almost 200 acres of county-owned land free of charge if promised investments were made. By our count, Chinese companies received about 1,500 acres while Haley was governor, much of it through land sales, despite her denial at the town hall.

For context, that’s only a drop in the bucket. According to an annual report by the U.S. Department of Agriculture, by the time Haley was preparing to leave office at the end of 2016, Chinese individuals and companies owned about 190,000 acres of land across the United States — a figure that has since grown to 384,000 acres.

But it’s not the picture she painted at the town hall.

Let’s start with the fiberglass company mentioned by Haley — China Jushi. This is a partially state-owned enterprise where a top official is a ranking Chinese Communist Party member. Board chairman Chang Zhangli is a party committee member. China National Building Material Company Limited, a state-owned company, owns nearly 27 percent of China Jushi, according to the company website. Several top officials of CNBMC also are party officials.

In 2016, the company announced that it would establish a manufacturing plant in South Carolina’s Richland County — an announcement that Haley in a news release called “a huge win for our state.” On Facebook, she declared: “Get excited! China Jushi is creating 400 new jobs and investing $300. million right here in Columbia!”

Governors often seek foreign investment if jobs will be created. “There is not a governor in this country or a state in this country that hasn’t worked to get Chinese business in their state somewhere,” Haley said at the town hall, defending the deal. “There’s not a household in this country that doesn’t have Chinese products in it. But there is a difference between focusing on something that’s going to hurt our national security and focusing on whether I brought a fiberglass company to South Carolina.”

But an important incentive here was a grant of land.

According to the contract between the county and China Jushi, a key part of the deal was the company’s receiving 197 acres of land, valued at $4.9 million. The company would have been required to pay back part of the land’s value if it did not invest an expected amount of money or create an expected number of jobs.

Let’s pause for a moment and look at how Haley spoke about the transaction at the town hall: “We didn’t sell any land to the Chinese. But, yes, I recruited a fiberglass company.” Note the use of the royal “we” when talking about land sales, in contrast to the “I” when referring to recruiting the company. The governor’s office of course would not necessarily negotiate specific land transactions; that was done at the county level. But she still wants to get credit for wooing the company without taking accountability for the details.

Indeed, a key player in winning foreign investment is the South Carolina Coordinating Council for Economic Development, which approves grants, tax credits and other incentives. For instance, a South Carolina job development credit provides companies with funds — as much as $3,250 per employee annually for 10 years — to offset the cost of locating or expanding a business facility. The coordinating council is chaired by the state’s commerce secretary, who is appointed by the governor.

Meanwhile, contrary to Haley’s suggestion that land sales were not involved, many other Chinese companies making investments in South Carolina purchased land, either from local governments or individuals, including:

Wellman Plastics Recycling, 2015 purchase (about 400 acres), after receiving a $500,000 expansion grant from the S.C. Department of Commerce.TechTronic Industries. 2015 expansion (300 acres), after receiving job development credits from the state coordinating council.Smithfield Foods, 2013 purchase (208 acres)Keer Group, 2013 new facility (133 acres), after receiving job development credits and a $4 million grant from the state coordinating council.

We found at least another 250 acres acquired by Chinese firms, although many of the acquisitions are relatively small, such as just over 58 acres in 2013 by JN Fibers for a new production facility after receiving an $800,000 state grant and other incentives; about 34 acres (valued at $15 million) by Yanfeng Automotive in 2016 to establish a plant; and nearly 31 acres by the plastics manufacturer Uniscite in 2015 to establish a manufacturing plant. Uniscite received a $400,000 grant and job development credits from the state coordinating council. Eleven other deals involved land purchases of under 30 acres each, with some also involving state grants and incentives.

A Haley campaign spokesperson declined to discuss her comments at the town hall on the record, including whether she was suggesting that as governor she had no control over land sales or grants.

In an emailed statement, the campaign said: “With China-owned companies in all fifty states and Chinese products in nearly every American home, China’s influence is pervasive. China buying farmland near our military bases and stealing American technology is a clear and present security threat. Chinese investment in glass manufacturing in America is not the same, although dangers in the consumer goods sector are greater today than they were five or ten years ago. Nikki Haley has the clearest vision of the comprehensive nature of the Chinese threat to America and will do what it takes to keep Americans safe.”

Haley sidestepped the questioner’s assertion that the state gave land to Chinese companies by suggesting the state did not sell land to Chinese companies. But in the specific example she cited — the fiberglass company — the land was, indeed, given free. As for the other Chinese investments, the land indeed was sold.

In the first instance, her remarks were was misleading. In the second instance, what she said was false. If Haley was intending to say that such decisions were made at the county level, notwithstanding her efforts to persuade Chinese companies to make investments in South Carolina, she should have made that clear to the town hall audience. Haley earns Four Pinocchios.

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