Chinese investments in the US plunged 84 per cent to its lowest level in seven years as Washington upped its scrutiny of deals, Beijing tightened capital controls and as relations between the world’s two largest economies soured over trade, a new report shows.

Chinese foreign direct investment in the US – including completed acquisitions and greenfield investments – fell to $4.8bn in 2018, from $29bn a year earlier and further down from $46bn in 2016, according to a report from Rhodium Group. The slump is set to continue this year with the pipeline of pending Chinese investments at a five-year low.

Including $13bn in US asset divestitures by Chinese investors, China’s net US investment actually shrank by $8bn in 2018. And while Chinese venture capital investment in the US hit a new record of $3.1bn last year there were signs of headwinds in the second half with a “slowdown in China’s technology sector and an expansion of US screening to include certain VC transactions”, the report said.