Chinese high-tech foreign direct investments in the EU – trends and policy responses

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This paper aims to examine the trends of Chinese high-tech acquisitions in the EU countries, describe the policies that these acquisitions prompted on the level of member states and the EU, and analyze the effects of these policy responses. The results of the research review clearly show an increasing number of takeovers of European companies in the high-tech sectors, especially in the big member states such as Germany, France, or the UK. This created a backlash from the European policymakers that led to an introduction of tighter screening regimes in many EU member states and the creation of a common EU framework for FDI screening and its strategic management. At this point, it is hard to evaluate the complete effect of this new framework, but it must be concluded that 82 percent of the Chinese strategic acquisitions made in 2018 would fall under at least one criterion of the new EU framework. The findings of this paper provide sound recommendations for the EU countries and their public authorities targeting to control Chinese outward foreign direct investment (OFDI) and limit the acquisition of local companies in sensitive industries. On the other hand, the coming recession may put at least a temporary halt on Chinese acquisitions of the European companies.

Acknowledgment
This paper is the partial result of the GAAA – Grantová agentura Akademické alliance grant project No. GA/6/2019 – Strategic Performance Management of Companies and Multinational Corporations in the Context of Globalization and Sustainability.

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    • Figure 1. Methodology framework
    • Figure 2. Chinese FDI flows to the EU between 2008 and 2019 (USD billion)
    • Figure 3. Number of acquisitions involving Chinese investors in Europe
    • Table 1. National-level screening mechanisms and changes since 2017 in selected EU member states
    • Conceptualization
      Tomas Dudas
    • Formal Analysis
      Tomas Dudas, Rastislav Rajnoha
    • Investigation
      Tomas Dudas, Rastislav Rajnoha
    • Methodology
      Tomas Dudas, Rastislav Rajnoha
    • Resources
      Tomas Dudas, Rastislav Rajnoha
    • Software
      Tomas Dudas
    • Supervision
      Tomas Dudas
    • Validation
      Tomas Dudas, Rastislav Rajnoha
    • Visualization
      Tomas Dudas, Rastislav Rajnoha
    • Writing – original draft
      Tomas Dudas, Rastislav Rajnoha
    • Writing – review & editing
      Tomas Dudas, Rastislav Rajnoha
    • Funding acquisition
      Rastislav Rajnoha
    • Project administration
      Rastislav Rajnoha