A China National Offshore Oil Corporation oil rig in the Bohai sea. Photograph: Reuters
Two high-profile takeover attempts of US companies by Chinese firms have hit the buffers. Haier, a Chinese conglomerate, has abandoned its $1.28bn bid for Maytag, after the maker of the iconic Hoover vacuum cleaners decided to accept a rival offer from Whirlpool.
Meanwhile, CNOOC, the state-owned oil company, has seen its $18.5bn offer spurned by Unocal, a midsize independent oil firm based in California. Unocal has decided to accept an offer from Chevron, America's second largest oil company, even though that bid is lower at $17bn.
In a takeover battle, the company with the higher bid usually wins. But the fact that CNOOC is Chinese has stirred up all sorts of fears. For some members of Congress you would think that the Chinese dragon is about to gobble the American eagle.
Some members of Congress see CNOOC's bid for Unocal as part of a broader strategy by China, still officially a communist country, as a bid to hoard energy supplies before they run out. Another concern is that the US might unintentionally hand over technology or assets of military value.
The fears about any takeover of US assets is somewhat misplaced given China's willingness to buy up enormous amounts of US government bonds. In soaking up dollops of US debt, China helps the Federal Reserve to keep American interest rates low, sustaining high levels of American consumer spending. Yet, members of Congress are not up in arms about this form of dependence.
Ambivalent US attitudes towards China are hardly surprising. While the two are locked in a tight economic embrace, the White House sees China as a possible security threat, with Taiwan a possible flashpoint between the two countries. Max Boot, writing in the Los Angeles Times, posits that the bid for Unocal falls into the category of "resource warfare", an attempt by the Chinese security apparatus to infiltrate US hi-tech firms and defence contractors.
For Thomas Friedman, the New York Times columnist, Unocal is a side issue. If China wants to overpay for a second-tier US energy company, that's China's business, he argues. More important for him is how the US and China manage the massive imbalances in their currencies.
The US wants China to raise its currency so that it buys more and sells less to the US. But China relies heavily on exports to maintain strong economic growth and provide jobs for those migrating to the cities from the countryside. Set against the bigger picture, Unocal seems pretty small beer.
