Chinese Investment in Europe Is Changing by Gabriele Manca

In The Diplomat’s latest article “Chinese Investment in Europe Is Changing”, Gabriele Manca discusses the potential future trajectory of Chinese investments in the EU and why those have been at a steady decline in recent years.

China’s “go global” policy successfully propelled China’s economic rise by encouraging its companies to invest abroad and gain access to new technologies. However, Chinese foreign direct investment in Europe has experienced a declining trend since 2016, reaching a new decade low in 2022.

The author states that this can be attributed to factors such as the COVID-19 pandemic, geopolitical tensions, and growing concerns about the political implications of deep economic integration with China. Despite the decline, there has been a shift in Chinese investments in Europe towards greenfield projects, particularly in the automotive sector, as China seeks to solidify its leadership in the green energy and electric vehicle industries.

Manca further argues that the future trajectory of Chinese investments in Europe remains uncertain due to security concerns and potential stricter screening of Chinese companies’ investments:

“Given all these conditions, we should not be surprised to see further Chinese investments in the European green sector. Nonetheless, the geopolitical context makes it unpredictable whether Europe, as a response to security concerns, will improve even stricter screening of Chinese companies’ investments.”

You can read the full article here

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