Chinese and Indian firms in Europe: characteristics, impacts and policy implications

Christian Milelli, Françoise Hay and Yunnan Shi

International Journal of Emerging Markets, 2010, vol. 5, issue 3/4, 377-397

Abstract: Purpose - Among emerging countries' foreign direct investment (FDI) in Europe, the Chinese and the Indian ones are the more relevant. Therefore, the paper focuses on Chinese and Indian affiliates in Europe, with a twofold purpose: to shed light on their characteristics and behaviour and to analyse some policy issues in the EU stemming from their arrival to Europe. Design/methodology/approach - First, the paper presents a review of the literature; second, it performs a qualitative analysis on the basis of a proprietary dataset. It then pinpoints the salient features of the Chinese and the Indian firms across Europe. Lastly, it focuses on the impacts of their operations on the European economies, and it concludes by a discussion on policy matters. Findings - Four main results stand out. First, the arrival of Chinese and Indian firms in Europe is linked to home country constraints. Second, large European countries are the most favoured destinations. Third, market access is the main attraction factor for Chinese and Indian firms coming to Europe. Fourth, the sectoral distribution of investments by Chinese and Indian companies reflects for a large part the comparative advantage of their home country. Originality/value - By taking into consideration data at a micro level, the paper gives a deeper view on FDI beyond the current ideas on the subject. It provides valuable insights on the behaviour of Chinese and Indian investors in Europe at a micro‐level. Furthermore, it explores a sensitive issue which is connected to the impacts on the European economies.

Keywords: International investments; Multinational companies; India; China; Europe (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijoemp:17468801011058433

DOI: 10.1108/17468801011058433

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