Push and Pull Factors for Chinese OFDI in Europe

Yun Schüler-Zhou, Margot Schüller and Magnus Brod
Authors registered in the RePEc Author Service: Yun Schueler-Zhou ()

Chapter 8 in Chinese International Investments, 2012, pp 157-174 from Palgrave Macmillan

Abstract: Abstract As Chinese companies have rapidly increased their outward foreign direct investment (OFDI) in the last decade, Europe has become a target for Chinese market-seeking and asset-seeking. The Chinese government plays a proactive role in guiding and supporting overseas investment, in part through its ‘going-global’ policy. The internationalization of Chinese companies is, however, to some extent a response to restrictive (domestic) market conditions. Within China, the growth of companies across provincial borders is still difficult due to regional protectionism (Child & Rodrigues, 2005, p. 388). Intense competition from foreign-funded enterprises in the domestic market also works as a driving force for the internationalization of Chinese companies (UNCTAD, 2006; Masron & Shahbudin, 2008, p. 6). These push factors are complemented by a number of pull factors that attract Chinese companies to the European Union (EU). Market-seeking companies want to explore the huge common market of the now 27 EU member states, while asset-seeking companies are most interested in buying high-tech companies and brand names in highly industrialized EU countries. But some of the very ambitious Chinese acquisition attempts involving well-known high-tech companies have not been realized due to legal, public or shareholder opposition.

Keywords: European Union; Foreign Direct Investment; Chinese Company; European Union Country; European Union Member State (search for similar items in EconPapers)
Date: 2012
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DOI: 10.1057/9780230361577_9

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