Chinese investments

chinese market

Last year, another in a row, there has been dynamic growth of Chinese investment in the Member States of the European Union. In the paper published in February a joint report Mercator Institute for China Studies and the Rhodium Group the total value of Chinese OFDI in the EU by 2015 was estimated at 20 billion euros, about 44% more than the year before. Strong accent this year was announced in February, the proposed acquisition of the Swiss company Syngenta by a Chinese State company ChemChina for record amount 43 billion usd. Chinese officials predict that this is just the beginning.
Traditionally convened March “dual session”-China Political Conference and the national people’s Congress Of Folk (OZPL) were needed for the new five-year Plan endorsement and with it the program of foreign economic expansion in the framework of the working masses so pampered by the Beijing initiative the new Silk Road. In the coming years, the work is probably a dynamic increase of Chinese stock market and foreign investments. The dignitaries of Kadima and the Government declare that over the next five years, their total value reaches $1 trillion.

The European Union is facing a huge challenge right at the front desk of the wave of Chinese investments, maximum use of opportunities and eliminate the serious threats that are comprehensively presented in the February report, and published by the same authors (Thilo Hanemann and Mikko Huotari) in the middle of last year, the larger study, which covers the years 2000-2014. According to the reports, a steady stream of significant Chinese investment will impact positively on the economy of the countries of the European Union and facilitate the conduct of the economic recovery in Europe and restart production sector. Chinese investors also facilitate air European companies access to the Chinese market through its distribution network and market position of what the flagship example of is currently the Swedish Volvo. More and more innovative and technologically advanced Chinese companies, for example. indicated by the authors of Alibaba, have to make a significant contribution to the development of European technological thought.

The situation on the Chinese market and the history of the existing investment tonują however, this optimistic picture. Taking into account the model entry, Chinese investors strongly prefer acquisitions. Investments (greenfield), although numerically dominate the acquisitions (726 to 321 in the years 2000-2014), in terms of value were in individual years several times smaller and from 2011 does not exceed 10% of the value of the investment in a given year. The Chinese still so much more to buy European companies than to the establishment of new ones. Although Hanemann and Huotari indicate the benefits of acquisitions, however, from the point of view of a rapid recovery of the European economy and the manufacturing sector is less favourable model than investments from scratch.

In industries where Chinese companies are taking over the European, such as automotive and machinery, real estate, technology, telecommunications and it, financial and business services the same access European companies to the Chinese market is the limited barriers to formal and informal. Potential export opportunities for acquired companies are therefore severely limited. The promotions seem to be also indicated in reports the benefits of Chinese thought and technological innovation. Named in reports of Huawei assuming R&D departments in Germany mainly uses the European knowledge engineers. Knowledge transfer in the other direction is smaller. Still many Chinese companies buy Western technology and know-how in Europe, for example: Pirelli, KrausMaffei, Putzmeister and last Norwegian Opera, in the USA for example. takeover bid shares of Micron Technology and Western Digital.