Combined Chinese direct investment in North America and Europe more than doubled in 2016 as China’s economy grew rapidly and continued its transition to a new growth model, says a report.
China’s foreign direct investment in the two regions rose a combined total of 130 per cent from 2015 to a new record of about US$94.2 billion (£75.30 billion), said a report released by international law firm Baker McKenzie.
For the first time since 2013, Chinese investors poured more money into North America than Europe, with 94 per cent of the total investments going to the United States, the report said.
“Well over half of all Chinese direct investment into Europe and North America since 2000 has taken place in the last three years, marking the continued influence of globalization and the rapid development of China’s economy,” said Michael DeFranco, global head of M&A at Baker McKenzie.
Privately owned Chinese firms outpaced investment by state-owned enterprises, closing deals taking up 70 per cent of the total, marking the continued rise of corporate China in the global economy.
In Europe, Chinese investors focused on Germany and the UK, which received about half of all investment in the continent.
The US largely accounted for the increase in North America, while investments in Canada were at three-year high at 120 per cent.
In Europe, information and communications technology, transport, utilities and infrastructure and industrial machinery saw the most activity, while the main recipients in North America were real estate and hospitality, transport, utilities and infrastructure, consumer products and services and entertainment.
“Chinese companies are growing market share, moving up value chains and investing in know-how to drive domestic and international demand for their goods and services,” said Zhang Danian, chief representative of Baker McKenzie’s Shanghai office.