China’s investments in Europe plunge amid coronavirus, squeeze on foreign buyers
- Chinese and Russian purchases in particular can expect to face review and scrutiny under the EU’s investment screening mechanisms
- The screening tools were established after concerns were raised about Chinese investments in European infrastructure sites and technology firms
A new report from the EU shows that Beijing’s share of the bloc’s total inbound investments dropped to 2.5 per cent in 2020 from 4 per cent in 2019.
While there was a broad decline in overall investment in Europe, it was more pronounced for China and Russia, two nations that have prickly relations with the EU and whose purchases could be expected to be scrutinised by the EU’s screening mechanisms.
Last year, the 20 EU member states with foreign direct investment (FDI) screening tools of their own referred 265 cases to the European Commission for review. Of those, 80 per cent passed review in a short first phase, with 14 per cent going to a second phase of more substantial evaluation.
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In total, the EU offered a final opinion on just eight transactions, with only 2 per cent of all inbound investments blocked.
