Mitt Romney during the first presidential debate at the University of Denver on Oct. 3. (Photo/Xinhua)
Republican candidate Mitt Romney has been keen to win support by painting China as a threat to US industry, saying he would label China a currency manipulator on his first day in office if elected. Yet the Guangzhou-based Time Weekly points out that Romney has had ties with China in the business career which he has touted as his major qualification for seeking his country's highest office.
The major source of Romney's fortune is Bain Capital, which he founded with three other partners in 1984 and which now boasts 400 specialists and US$65 billion in funds under its management. During the 14 years when Romney headed the company, it racked up annual investment returns of 113% on average.
Bain has close business links with China, having entered the Chinese market in 1993 by setting up an office in Beijing, the first international strategic consulting firm to do so, at a time when the company was headed by Romney.
According to the New York Times, Romney has a stake worth US$250,000 in the Bain Capital Asia Fund and US$1 million each in the company's IX and X funds. Founded in February 2007, the Bain Capital Asia Fund boasts a scale of US$1 billion, focusing on investments in China and Japan.
Bain has invested heavily in at least eight Chinese enterprises, including Gome Electrical Appliances and firms in the fields of food packaging and firefighting equipment.
At the end of 2011, Bain acquired China Fire & Security Group for US$265 million; founded in 1950, the company is the first firefighting firm listed on the US stock market.
In September 2010, Bain spent US$165 million to buy Asimco Technologies and its 11 subsidiaries and affiliates. Asimco is a leading Chinese manufacturer of auto parts.
The company encountered a major setback in its investment in Gome, however, one of China's leading retailers of home appliances. In 2009, Bain spent HK$1.8 billion (US$232 million) to subscribe to seven-year convertible bonds floated by Gome and converted the holdings into shares in September 2010, becoming the company's second-largest shareholder with a 9.98% stake. In the first half of 2012, Gome incurred huge losses of over 500 million yuan (US$80 million), leading Bain to suffer a near 40% loss on paper in its investment in Gome.
According to Time Weekly, Romney says that China has taken jobs from American workers but the accusation seems to apply to manufacturing enterprises in which Bain invests. Even Romney's investments in the US cannot be insulated from the China issue. Bain owns a stake worth US$2.6 billion in Sensata Technologies, a manufacturer of sensing detectors and controlling devices, which employs 4,000 people in China.