This paper explores the political challenges posed by the recent influx of Chinese outward foreign direct investment （OFDI） into the European Union （EU）. Chinese OFDI has increased substantially in recent years. C...This paper explores the political challenges posed by the recent influx of Chinese outward foreign direct investment （OFDI） into the European Union （EU）. Chinese OFDI has increased substantially in recent years. Chinese direct investment is still minute in the EU, but it is growing fast, and the strong upward trajectory is likely to continue in the years to come. This surge represents challenges and opportunities for EU countries. In the current context of economic and debt crisis in Europe, whether China is seen as a saviour or a predator, the question of a Faustian bargain made by European countries by courting and hosting Chinese investment needs to be asked. The benefits of foreign direct investment （FDI） for the host economy are well known, but Chinese OFDI may come with implicit strings attached and could potentially act as a Trojan Horse, affecting European norms and policies. The influx of Chinese OFDI can create an unhealthy transatlantic competition with security ramifications, which should therefore be addressed. It is interesting to find the right balance between ensuring the benefits from Chinese FDI （from job creation to productivity gains） and protecting from its harmful effects.展开更多
This paper critically reviews Chinese companies' foreign direct investment practices of recent years. Using case studies involving overseas Greenfield as well as merger and acquisition(M&A) of Chinese enterpri...This paper critically reviews Chinese companies' foreign direct investment practices of recent years. Using case studies involving overseas Greenfield as well as merger and acquisition(M&A) of Chinese enterprises, we aim to draw lessons from these experiences. However, because of increasing importance of outbound acquisitions by Chinese companies, this paper focuses on Chinese M&A activities. After presenting the theoretical discussions of post-acquisition organizational integration, this paper identifies factors that have contributed to less than expected performances of Chinese foreign investments. Three main factors are identified as the plausible causes of the less than satisfactory outcomes: inadequate due diligence, not considering political and country risks, and cultural differences. In all cases, inexperience of Chinese enterprises in foreign direct investment, either in Greenfield form or M&A, has attributed to the problems. Therefore, summing the experiences of the Chinese enterprises that have foreign direct investment is essential for those Chinese investors that intend to invest overseas. Conduct of meaningful, in-depth due diligence before serious negotiations for investment or acquisition, inclusion of risk premium for political risk in cash flow analysis, and early post-merger integration planning are essential for avoidances of bitter outcomes many Chinese investors experienced overseas.展开更多
For some 20 years, the rate of investment by EU enterprises into China has been rising, reaching an annual average of some US$5bn over the 10 years to 2009. Conversely, the EU has not been a focus for Chinese investme...For some 20 years, the rate of investment by EU enterprises into China has been rising, reaching an annual average of some US$5bn over the 10 years to 2009. Conversely, the EU has not been a focus for Chinese investments, nor has Chinese investment been important to the EU despite the wide attention given to recent landmark cross-border acquisitions. Therefore, the overall impact of Chinese investment on the European economy is small. However, this situation might now be changing following institutional changes in the EU. In light of the potential for Chinese foreign direct investment to the EU, in this paper we outline the motives for, and patterns of Chinese outward investments to the EU, and the impacts that these investments might exert on the recipient.展开更多
文摘This paper explores the political challenges posed by the recent influx of Chinese outward foreign direct investment （OFDI） into the European Union （EU）. Chinese OFDI has increased substantially in recent years. Chinese direct investment is still minute in the EU, but it is growing fast, and the strong upward trajectory is likely to continue in the years to come. This surge represents challenges and opportunities for EU countries. In the current context of economic and debt crisis in Europe, whether China is seen as a saviour or a predator, the question of a Faustian bargain made by European countries by courting and hosting Chinese investment needs to be asked. The benefits of foreign direct investment （FDI） for the host economy are well known, but Chinese OFDI may come with implicit strings attached and could potentially act as a Trojan Horse, affecting European norms and policies. The influx of Chinese OFDI can create an unhealthy transatlantic competition with security ramifications, which should therefore be addressed. It is interesting to find the right balance between ensuring the benefits from Chinese FDI （from job creation to productivity gains） and protecting from its harmful effects.
文摘This paper critically reviews Chinese companies' foreign direct investment practices of recent years. Using case studies involving overseas Greenfield as well as merger and acquisition(M&A) of Chinese enterprises, we aim to draw lessons from these experiences. However, because of increasing importance of outbound acquisitions by Chinese companies, this paper focuses on Chinese M&A activities. After presenting the theoretical discussions of post-acquisition organizational integration, this paper identifies factors that have contributed to less than expected performances of Chinese foreign investments. Three main factors are identified as the plausible causes of the less than satisfactory outcomes: inadequate due diligence, not considering political and country risks, and cultural differences. In all cases, inexperience of Chinese enterprises in foreign direct investment, either in Greenfield form or M&A, has attributed to the problems. Therefore, summing the experiences of the Chinese enterprises that have foreign direct investment is essential for those Chinese investors that intend to invest overseas. Conduct of meaningful, in-depth due diligence before serious negotiations for investment or acquisition, inclusion of risk premium for political risk in cash flow analysis, and early post-merger integration planning are essential for avoidances of bitter outcomes many Chinese investors experienced overseas.
基金research initiated under the EU's Jean Monnet Project,Multilateral Research Group "Towards a closer association between China and the EU:Searching for windows of opportunity"(2009-2011) coordinated by the Instituto Universitario de Estudios Europeos,Universidad San Pablo,and was presented at the Pacific Trade and Development Conference Series in Beijing 2010
文摘For some 20 years, the rate of investment by EU enterprises into China has been rising, reaching an annual average of some US$5bn over the 10 years to 2009. Conversely, the EU has not been a focus for Chinese investments, nor has Chinese investment been important to the EU despite the wide attention given to recent landmark cross-border acquisitions. Therefore, the overall impact of Chinese investment on the European economy is small. However, this situation might now be changing following institutional changes in the EU. In light of the potential for Chinese foreign direct investment to the EU, in this paper we outline the motives for, and patterns of Chinese outward investments to the EU, and the impacts that these investments might exert on the recipient.
